Diamond Foods, Inc. (DMND): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report


Although Diamond Foods' third-quarter fiscal 2014 earnings missed the Zacks Consensus Estimate, we are impressed with its cost containment endeavors and operational initiatives, which helped it to register a 37.5% year over year growth. Further, we observed that the company's turnaround strategies such as improving price realization, lowering underperforming SKUs and reducing dependency on discounts have helped it stabilize falling revenues as apparent from its flat year over year sales performance. Moreover, we expect the company's future results to exhibit more sustained growth of its brands due to product innovation and differentiation as well as improved cost structure. However, we cannot ignore the near-term headwinds such as challenges related to procurement of walnut supplies and mending ties with growers. Furthermore, we remain skeptical about the company's performance going forward due to its highly leveraged balance sheet.


Headquartered in Stockton, CA, Diamond Foods Inc. is a specialty food company focused on processing, marketing and distribution of snack products and culinary, ingredient and in-shell nuts. Diamond Foods reports its operating results under 2 segments Snacks and Nuts. Snacks segment comprises the Kettle U.S., Kettle U.K. and Pop Secret brands, while the Nuts segment includes the Diamond of California and Emerald brands.

Diamond Foods products are sold in more than 60,000 retail locations in the United States, and also overseas in more than 100 countries, primarily in Germany, Japan, Spain and Italy.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Stocks

Referenced Stocks: DMND



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