Lancaster Colony Earnings Preview

Motley Fool Staff
Updated

Investors never know what to expect for Lancaster Colony (NAS: LANC) , as it has wavered between topping and missing analysts estimates during the past fiscal year. The company will unveil its latest earnings on Thursday. Lancaster Colony is a manufacturer and marketer of consumer products with a focus on food products for the retail and food service markets.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Lancaster Colony with analysts unanimously rating it hold. Analysts don't like Lancaster Colony as much as competitor Hain Celestial Group overall. Eight out of 12 analysts rate Hain Celestial Group a buy compared to zero of four for Lancaster Colony. Lancaster Colony's rating hasn't changed over the past three months.

  • Revenue forecasts: On average, analysts predict $262.1 million in revenue this quarter. That would represent a rise of 5.7% from the year-ago quarter.

  • Wall Street earnings expectations: The average analyst estimate is earnings of $0.80 per share. Estimates range from $0.76 to $0.86.

What our community says:
CAPS All-Stars are solidly behind the stock with 94.1% giving it an outperform rating. The community at large agrees with the All-Stars with 93.8% granting it a rating of outperform. Fools have embraced Lancaster Colony, though the message boards have been quiet lately with only 31 posts in the past 30 days. Lancaster Colony has a bullish CAPS rating of five out of five stars that is about on par with the Fool community assessment.

Management:
Lancaster Colony's income has fallen year over year by an average of 17.8% over the past five quarters. Revenue has now gone up for three straight quarters. The company's gross margin shrank by 3.9 percentage points in the last quarter. Revenue rose 0.9% while cost of sales rose 6.2% to $200.1 million from a year earlier.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter

Q3

Q2

Q1

Q4

Gross Margin

20.8%

24.7%

21.9%

24.2%

Operating Margin

11.7%

16.5%

13.1%

14.2%

Net Margin

7.7%

11.0%

8.6%

9.2%

One final thing: If you want to keep tabs on Lancaster Colony movements, and for more analysis on the company, make sure you add it to your watchlist.

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At the time thisarticle was published

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