Packaged food giant
General Mills Inc
) recently announced the launch of its Yoplait branded Greek
yogurt for kids, revealing its yet another effort to turnaround
the sluggish Yoplait yogurt business.
Named as Yoplait Pro-Force, this Greek yogurt is claimed to be
very nutritional with high levels of protein and calcium. At the
same time, it is available in attractive flavors of Strawberry
Blast and Mixed Berry Burst.
Through its strategy of innovating new and established brands,
the company wants to cater to the increasing global demand for
packaged food. Some of these innovations, mainly in yogurt, add
more nutritional value to the packaged food with more fruits,
vegetables and fiber and less fat content. The idea is to appeal
to the growing numbers of health-conscious customers who prefer
the convenience of packaged food in a healthier way.
In the first quarter of fiscal 2013 alone, General Mills
launched around 35 new products in the U.S. yogurt category.
Popular among those were Yoplait Greek 100 and Liberte Greek
General Mills' Yoplait yogurt business is presently struggling
as increased sales prices in response to dairy cost inflation is
reducing the competitiveness of its products.
The company plans to take steps to re-invigorate its yogurt
business in the U.S. in 2013 through innovation and increased
promotional support for new products.
General Mills carries a Zacks Rank #3 (Hold). The company
announced impressive second quarter fiscal 2013 results in
mid-December last year. Earnings rose 13% year on year and also
beat the Zacks Consensus Estimate by almost 9%. The company also
delivered solid revenue growth and upped its full-year earnings
Overall, we are encouraged by the company's strong market
share position in some leading food categories, its growing
international presence, strategic acquisitions and focus on
innovation and brand support. These growth initiatives combined
with the cost saving efforts bode well for the company's
long-term growth. However, we prefer to remain on the sidelines
until the U.S. retail volumes improve substantially, the Yoplait
yogurt business delivers stronger results and the macroeconomic
General Mills' competitors,
ConAgra Foods, Inc.
) both carry a better rank; Zacks Rank #2 (Buy).
CONAGRA FOODS (CAG): Free Stock Analysis
GENL MILLS (GIS): Free Stock Analysis Report
KELLOGG CO (K): Free Stock Analysis Report
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