Jefferies Raises Price Target on General Mills (GIS) Slightly as Outlook Remains Flat
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Price: $39.97 +0.91%
Rating Summary:
6 Buy, 20 Hold, 5 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
6 Buy, 20 Hold, 5 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Jefferies is maintaining its Hold rating on shares of General Mills (NYSE: GIS) and is raising its price target from $40 to $41 following the release of its second quarter results.
The company reported second quarter earnings of $0.76 per share, missing both the Street's and firm's estimates of $0.79 per share. Sales growth of 13.7 percent for the quarter topped the firms 13.3 percent growth estimate slightly. Due to higher input costs and higher media investments, EBIT margin missed the firm's estimate by 130 bps.
An analyst at Jefferies comments The 50 percent growth in Yoplait Greek "has to be seen in contrast to almost 150% revenue growth in tracked channels for Chobani, which is growing from a much larger base. This dynamic makes us concerned that Yoplait Greek is not appealing enough to core Greek eaters and the announced 2H12 Yoplait Greek innovation does not seem to address this issue. The Yoplait performance is also symptomatic for revenue underperformance in tracked channels, where snack and granola bars are the one positive exception."
The firm's long-term outlook muted. Jefferies is lowering its FY12 EPS estimate by $0.01 to $2.59 and is reaffirming its FY13 estimate of $2.83. Revenue for FY12 and FY13 is now forecasted to be $16.779 billion and $17.509 billion.
For an analyst ratings summary and ratings history on General Mills click here. For more ratings news on General Mills click here.
Shares of General Mills closed at $39.27 yesterday.
The company reported second quarter earnings of $0.76 per share, missing both the Street's and firm's estimates of $0.79 per share. Sales growth of 13.7 percent for the quarter topped the firms 13.3 percent growth estimate slightly. Due to higher input costs and higher media investments, EBIT margin missed the firm's estimate by 130 bps.
An analyst at Jefferies comments The 50 percent growth in Yoplait Greek "has to be seen in contrast to almost 150% revenue growth in tracked channels for Chobani, which is growing from a much larger base. This dynamic makes us concerned that Yoplait Greek is not appealing enough to core Greek eaters and the announced 2H12 Yoplait Greek innovation does not seem to address this issue. The Yoplait performance is also symptomatic for revenue underperformance in tracked channels, where snack and granola bars are the one positive exception."
The firm's long-term outlook muted. Jefferies is lowering its FY12 EPS estimate by $0.01 to $2.59 and is reaffirming its FY13 estimate of $2.83. Revenue for FY12 and FY13 is now forecasted to be $16.779 billion and $17.509 billion.
For an analyst ratings summary and ratings history on General Mills click here. For more ratings news on General Mills click here.
Shares of General Mills closed at $39.27 yesterday.
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