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Post Holdings' (POST) Q4 Earnings Upcoming: Factors to Note

Post Holdings, Inc. POST is likely to register a top-line decrease from the year-ago fiscal quarter’s reading when it reports fourth-quarter fiscal 2022 earnings on Nov 17. The Zacks Consensus Estimate for quarterly revenues is pegged at $1,527 million, suggesting a decline of 9.9% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for the fourth-quarter bottom line has declined by 2.7% in the past 30 days to 71 cents per share. This indicates a 61.4% increase from the figure reported in the prior-year fiscal quarter.

This consumer-packaged goods company has a trailing four-quarter negative earnings surprise of 6.4%, on average. However, POST delivered an earnings surprise of about 19% in the last reported quarter.

Post Holdings, Inc. Price, Consensus and EPS Surprise

Post Holdings, Inc. price-consensus-eps-surprise-chart | Post Holdings, Inc. Quote

Factors to Consider

Post Holdings has been battling cost-related hurdles. In the third quarter of fiscal 2022, its gross margin contracted from 29.5% to 23.9% due to higher raw material, freight and manufacturing costs.

Labor shortages and supply-chain hurdles caused manufacturing inefficiencies and capacity constraints in the third quarter of 2022. These limitations hurt sales, lowered throughput and increased per-unit product costs.

The company’s operations have been hurt by high inflation, rising fuel and energy prices and restricted availability, thereby raising the cost of certain raw materials and other commodities. On the last earnings call, management stated that it expects the cost of energy and raw materials to remain inflated due to the Ukraine-Russia war. This raises concerns for the quarter to be reported.

However, Post Holdings is benefiting from the recovery in the Foodservice business. In the third quarter of fiscal 2022, Foodservice sales increased 33.1% to $579 million. Volumes rose 6.2% due to increased away-from-home egg and potato demand.

Moreover, segmental adjusted EBITDA was $86.4 million, up 44.5% year over year. Management projected the Foodservice business to exceed the pre-pandemic profitability level by the fourth quarter.

The company has also been gaining from its prudent acquisitions. These have been helping it expand the customer base.

In the third quarter of fiscal 2022, POST’s top line included $128.1 million in net sales from acquisitions. These buyouts include the Lacka Foods Limited, the Private label ready-to-eat cereal business, the Egg Beaters liquid egg brand, the Almark Foods business and related assets and the Peter Pan peanut butter brand. The continuation of these trends bodes well.

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Post Holdings this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.

Post Holdings has a Zacks Rank #4 (Sell) and an Earnings ESP of -18.69%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some companies worth considering as our model shows that these have the right combination of elements to beat earnings this season.

The J. M. Smucker Company SJM currently has an Earnings ESP of +1.06% and a Zacks Rank #1. The company is expected to register a decrease in the bottom line when it reports second-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of $2.17 suggests a dip of 10.7% from the year-ago quarter.  You can see the complete list of today’s Zacks #1 Rank stocks here.

Smucker’s top line is anticipated to have increased year over year. The consensus mark for SJM’s revenues is pegged at $2.16 billion, indicating an increase of 5.2% from the figure reported in the year-ago quarter. Smucker has a trailing four-quarter earnings surprise of 20.8%, on average.

Campbell Soup Company CPB currently has an Earnings ESP of +4.30% and a Zacks Rank #3. The company is expected to register a decrease in the bottom line when it reports first-quarter fiscal 2023 results. The Zacks Consensus Estimate for the quarterly EPS of 84 cents suggests a dip of 5.6% from the year-ago quarter.  

Campbell Soup’s top line is anticipated to have increased year over year. The consensus mark for CPB’s revenues is pegged at $2.42 billion, indicating an increase of 8.1% from the figure reported in the year-ago quarter. Campbell Soup has a trailing four-quarter earnings surprise of 6.5%, on average.

Dollar Tree DLTR has an Earnings ESP of +6.57% and a Zacks Rank of 3 at present. DLTR is likely to register top-line growth from the year-ago fiscal quarter’s reported number when it reports third-quarter fiscal 2022 numbers. The Zacks Consensus Estimate for quarterly revenues is pegged at $6.83 billion, suggesting 6.5% growth from the figure reported in the prior-year fiscal quarter.

The Zacks Consensus Estimate for Dollar Tree’s earnings for the fiscal third quarter is pegged at $1.16 per share, suggesting 20.8% growth from the year-ago fiscal quarter’s tally. The consensus mark has been stable in the past 30 days. DLTR delivered an earnings surprise of 8.6%, on average, in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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Dollar Tree, Inc. (DLTR) : Free Stock Analysis Report
 
Campbell Soup Company (CPB) : Free Stock Analysis Report
 
The J. M. Smucker Company (SJM) : Free Stock Analysis Report
 
Post Holdings, Inc. (POST) : Free Stock Analysis Report
 
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