Kraft Foods Group Inc.
) is set to report fourth quarter 2012 results on Feb 15. Last
quarter it posted a 16.18% positive surprise. Let's see how
things are shaping up for this announcement.
Growth Factors This Past Quarter
Kraft Foods Group, reported its third quarter 2012 results,
after its spun off from the old Kraft Foods. The packaged food
and beverage company beat on both the top and bottom lines in its
third quarter 2012 on the back of innovation, productivity
improvements, volume growth, lower taxes and increased marketing
investments. The fourth quarter results will be Kraft's first
earnings report as a standalone entity versus carve-out
financials reported in the third quarter.
Our proven model does not conclusively show that Kraft Foods
Group is likely to beat earnings this quarter. That is because a
stock needs to have both a positive Earnings ESP (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, 2 or 3 for this to happen. That is not the
case here as you will see below.
Negative Zacks ESP:
Kraft Foods Group's currently has a negative Expected Surprise
Prediction (ESP) of -10.00%.
Zacks Rank #2 (Buy):
Kraft Foods' Zacks Rank #2 (Buy) when combined with a negative
ESP makes surprise prediction difficult. We caution against
stocks with Zacks #4 and #5 Ranks (Sell-rated stocks) going into
the earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
Though brand building and innovation are expected to boost
consumption, the company expects revenues to be flat to down in
the fourth quarter from the year-ago levels due to difficult
comparisons and more product pruning. Product pruning is expected
to hurt the top line by 1.5 to 2 points in the quarter. In the
quarter, the company expects to record restructuring costs of
Other Stocks to Consider
Here are some other companies you may want to consider as our
model shows they have the right combination of elements to post
an earnings beat this quarter:
Flowers Foods, Inc.
), Earnings ESP of 5.56% and Zacks Rank #1 (Strong Buy)
J&J Snack Foods Corp.
), Earnings ESP of 5.00% and Zacks Rank #1 (Strong Buy)
), Earnings ESP of 0.97% and Zacks Rank #2 (Buy)
FLOWERS FOODS (FLO): Free Stock Analysis
J&J SNACK FOODS (JJSF): Free Stock Analysis
KELLOGG CO (K): Free Stock Analysis Report
KRAFT FOODS GRP (KRFT): Free Stock Analysis
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