How is Kraft Foods Placed for 4Q? - Analyst Blog
12 Febbraio 2013 - 7:01PM
Zacks
Kraft Foods Group Inc. (KRFT) is set to report
fourth quarter 2012 results on Feb 15. Last quarter it posted a
16.18% positive surprise. Let’s see how things are shaping up for
this announcement.
Growth Factors This Past Quarter
Kraft Foods Group, reported its third quarter 2012 results,
after its spun off from the old Kraft Foods. The packaged food and
beverage company beat on both the top and bottom lines in its third
quarter 2012 on the back of innovation, productivity improvements,
volume growth, lower taxes and increased marketing investments. The
fourth quarter results will be Kraft’s first earnings report as a
standalone entity versus carve-out financials reported in the third
quarter.
Earnings Whispers?
Our proven model does not conclusively show that Kraft Foods
Group is likely to beat earnings this quarter. That is because a
stock needs to have both a positive Earnings ESP (Read: Zacks
Earnings ESP: A Better Method) and a Zacks Rank #1, 2 or 3 for this
to happen. That is not the case here as you will see below.
Negative Zacks ESP: Kraft Foods Group’s
currently has a negative Expected Surprise Prediction (ESP) of
-10.00%.
Zacks Rank #2 (Buy): Kraft Foods’ Zacks Rank #2
(Buy) when combined with a negative ESP makes surprise prediction
difficult. We caution against stocks with Zacks #4 and #5 Ranks
(Sell-rated stocks) going into the earnings announcement,
especially when the company is seeing negative estimate revisions
momentum.
Though brand building and innovation are expected to boost
consumption, the company expects revenues to be flat to down in the
fourth quarter from the year-ago levels due to difficult
comparisons and more product pruning. Product pruning is expected
to hurt the top line by 1.5 to 2 points in the quarter. In the
quarter, the company expects to record restructuring costs of $225
million.
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post an
earnings beat this quarter:
Flowers Foods, Inc. (FLO), Earnings ESP of
5.56% and Zacks Rank #1 (Strong Buy)
J&J Snack Foods Corp. (JJSF), Earnings ESP
of 5.00% and Zacks Rank #1 (Strong Buy)
Kellogg Company (K), Earnings ESP of 0.97% and
Zacks Rank #2 (Buy)
FLOWERS FOODS (FLO): Free Stock Analysis Report
J&J SNACK FOODS (JJSF): Free Stock Analysis Report
KELLOGG CO (K): Free Stock Analysis Report
KRAFT FOODS GRP (KRFT): Free Stock Analysis Report
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