Earnings results often indicate what direction a company will take in the months ahead. With Q4 behind us, let’s have a look at Lancaster Colony (NASDAQ: LANC) and its peers.
As America industrialized and moved away from an agricultural economy, people faced more demands on their time. Packaged foods emerged as a solution offering convenience to the evolving American family, whether it be canned goods or snacks. Today, Americans seek brands that are high in quality, reliable, and reasonably priced. Furthermore, there's a growing emphasis on health-conscious and sustainable food options. Packaged food stocks are considered resilient investments. People always need to eat, so these companies can enjoy consistent demand as long as they stay on top of changing consumer preferences. The industry spans from multinational corporations to smaller specialized firms and is subject to food safety and labeling regulations.
The 21 shelf-stable food stocks we track reported a slower Q4. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 0.5% above.
While some shelf-stable food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.9% since the latest earnings results.
Best Q4: Lancaster Colony (NASDAQ: LANC)
Known for its frozen garlic bread and Parkerhouse rolls, Lancaster Colony (NASDAQ: LANC) sells bread, dressing, and dips to the retail and food service channels.
Lancaster Colony reported revenues of $509.3 million, up 4.8% year on year. This print exceeded analysts’ expectations by 2.8%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA estimates.
CEO David A. Ciesinski commented, “We were very pleased to complete the quarter with record sales, gross profit and operating income. The 6.3% increase in Retail segment net sales was driven by growth from both our licensing program and our own brands. In licensing, we had notable contributions from our recently introduced Texas Roadhouse® dinner rolls, as well as Buffalo Wild Wings® sauces, Subway® sauces and Olive Garden® dressings. In addition, our Marzetti® brand caramel dips and refrigerated dressings were noted contributors to the growth in Retail segment net sales. In the Foodservice segment, sales growth of 3.0% was led by higher demand from several of our core national chain restaurant accounts along with increased sales for our branded Foodservice products.”
Lancaster Colony pulled off the biggest analyst estimates beat of the whole group. The stock is up 5.6% since reporting and currently trades at $175.87.
Is now the time to buy Lancaster Colony? Access our full analysis of the earnings results here, it’s free.
Hershey (NYSE: HSY)
Best known for its milk chocolate bar and Hershey's Kisses, Hershey (NYSE: HSY) is an iconic company known for its chocolate products.
Hershey reported revenues of $2.89 billion, up 8.7% year on year, outperforming analysts’ expectations by 1.6%. The business had a very strong quarter with a solid beat of analysts’ gross margin and EBITDA estimates.
The market seems happy with the results as the stock is up 15.7% since reporting. It currently trades at $168.85.
Is now the time to buy Hershey? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Lamb Weston (NYSE: LW)
Best known for its Grown in Idaho brand, Lamb Weston (NYSE: LW) produces and distributes potato products such as frozen french fries and mashed potatoes.
Lamb Weston reported revenues of $1.60 billion, down 7.6% year on year, falling short of analysts’ expectations by 4.3%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
Lamb Weston delivered the weakest full-year guidance update in the group. As expected, the stock is down 31.3% since the results and currently trades at $53.67.
Read our full analysis of Lamb Weston’s results here.
Post (NYSE: POST)
Founded in 1895, Post (NYSE: POST) is a packaged food company known for its namesake breakfast cereal and healthier-for-you snacks.
Post reported revenues of $1.97 billion, flat year on year. This number met analysts’ expectations. Taking a step back, it was a mixed quarter as it also recorded a decent beat of analysts’ EPS estimates but a miss of analysts’ EBITDA estimates.
The stock is up 5.9% since reporting and currently trades at $112.06.
Read our full, actionable report on Post here, it’s free.
J&J Snack Foods (NASDAQ: JJSF)
Best known for its SuperPretzel soft pretzels and ICEE frozen drinks, J&J Snack Foods (NASDAQ: JJSF) produces a range of snacks and beverages and distributes them primarily to supermarket and food service customers.
J&J Snack Foods reported revenues of $362.6 million, up 4.1% year on year. This result was in line with analysts’ expectations. Zooming out, it was a disappointing quarter as it logged a significant miss of analysts’ adjusted operating income estimates.
The stock is down 4.8% since reporting and currently trades at $126.53.
Read our full, actionable report on J&J Snack Foods here, it’s free.
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