Smithfield Foods Beats on EPS, but GAAP Results Lag
Smithfield Foods (NYS: SFD) reported earnings on March 8. Here are the numbers you need to know.
The 10-second takeaway
For the quarter ended Jan. 29 (Q3), Smithfield Foods met expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased, and GAAP earnings per share contracted significantly.
Margins dropped across the board.
Smithfield Foods reported revenue of $3.48 billion. The 13 analysts polled by S&P Capital IQ foresaw sales of $3.50 billion on the same basis. GAAP reported sales were 9.2% higher than the prior-year quarter's $3.19 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.69. The 15 earnings estimates compiled by S&P Capital IQ predicted $0.64 per share on the same basis. GAAP EPS of $0.49 for Q3 were 60% lower than the prior-year quarter's $1.21 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 10.9%, 370 basis points worse than the prior-year quarter. Operating margin was 5.5%, 220 basis points worse than the prior-year quarter. Net margin was 2.3%, 410 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $3.30 billion. On the bottom line, the average EPS estimate is $0.60.
Next year's average estimate for revenue is $13.16 billion. The average EPS estimate is $2.66.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 198 members rating the stock outperform and 39 members rating it underperform. Among 83 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 71 give Smithfield Foods a green thumbs-up, and 12 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Smithfield Foods is outperform, with an average price target of $27.92.
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At the time this article was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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