Canaccord Genuity Morning Coffee on Dole Food Company (DOLE): Don’t Step On That Banana Peel!
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Price: $13.37 +0.60%
Rating Summary:
4 Buy, 3 Hold, 1 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 12 | Down: 15 | New: 40
Rating Summary:
4 Buy, 3 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 12 | Down: 15 | New: 40
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Canaccord Genuity Morning Coffee on Dole Food Company (NYSE: DOLE): Don’t step on that banana peel!
Canaccord analyst says, "Shares of Dole Food Co. dropped as the company swung to a fourth quarter loss on a prior- year derivatives gain and increased costs due to inclement Latin American winter weather. CEO David DeLorenzo said “pervasive cold, cloudy and rainy weather” drove up prices, leading the company to report a loss of $0.41 per share on revenue of $1.56 billion while analysts were expecting profit of $0.18 on revenue of $1.55 billion. Fellow banana producers Chiquita Brands (NYSE: CQB) and Fresh Del Monte Produce (NYSE: FDP) also recently reported poor results which were attributed to increased costs due to poor weather conditions. The company was unable to pass along the cost increase to consumers as an Iranian import ban forced it to flood the Asian market with bananas, driving prices down. Dole does expect sales to grow this year on the back of the economic recovery and says it has had success passing on increased costs to consumers thus far. Also, despite the recent disaster in Japan, DeLorenzo believes sales will be strong in the country in 2011, noting that there will likely be a rush to restock shelves in major cities in the near term. A JP Morgan analyst sees 2011 possibly being a turnaround year for the company, noting that the fourth quarter miss was largely due to poor Asian pricing and Latin American challenges, which they believe are non-recurring events."
Canaccord analyst says, "Shares of Dole Food Co. dropped as the company swung to a fourth quarter loss on a prior- year derivatives gain and increased costs due to inclement Latin American winter weather. CEO David DeLorenzo said “pervasive cold, cloudy and rainy weather” drove up prices, leading the company to report a loss of $0.41 per share on revenue of $1.56 billion while analysts were expecting profit of $0.18 on revenue of $1.55 billion. Fellow banana producers Chiquita Brands (NYSE: CQB) and Fresh Del Monte Produce (NYSE: FDP) also recently reported poor results which were attributed to increased costs due to poor weather conditions. The company was unable to pass along the cost increase to consumers as an Iranian import ban forced it to flood the Asian market with bananas, driving prices down. Dole does expect sales to grow this year on the back of the economic recovery and says it has had success passing on increased costs to consumers thus far. Also, despite the recent disaster in Japan, DeLorenzo believes sales will be strong in the country in 2011, noting that there will likely be a rush to restock shelves in major cities in the near term. A JP Morgan analyst sees 2011 possibly being a turnaround year for the company, noting that the fourth quarter miss was largely due to poor Asian pricing and Latin American challenges, which they believe are non-recurring events."
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