) recently announced its plans to increase dividend by 4.5%. The
quarterly dividend is proposed to be increased from 44 cents to
46 cents per common share, equivalent to an annual dividend of
$1.84 per share. The increased quarterly dividend will, however,
be payable from the third quarter of 2013.
In addition, the company has announced its board of directors'
decision to pay a dividend of 44 cents on Jun 17 to shareholders
on record as of Jun 3.
The food giant is set to report its first-quarter fiscal 2013
results on May 2 before the market opens. During the first
quarter, sales growth is expected to be solid.
We believe the improving volume trends in North America and
the strong performance of its Pringles business will once again
drive the top line in the quarter. Kellogg acquired
The Procter & Gamble Company
) snack unit in Jun 2012, which included the Pringles brand, for
$2.7 billion. Pringles is now the second-largest brand at
However, the company expects adjusted operating profit to
decline slightly year-over-year due to higher costs of input and
other cost increases. Earnings per share are also expected to be
down in the first quarter due to difficult year-ago comparisons
(which included a benefit of 5 cents from interest rate hedges)
and headwinds from the Venezuela currency devaluation.
Kellogg carries a Zacks Rank #2 (Buy). The company's solid
brand positioning, its geographic diversity and significant
investments behind innovation, marketing and supply-chain
initiatives are encouraging. Moreover, we are encouraged by the
growth potential, diversification and international presence that
the Pringles deal provides. However, the strained cereal
business, pressures in Europe and rising input costs create
Some other food companies you may want to consider include
Flower Foods Inc.
), with a Zacks Rank #1 (Strong Buy) and
J&J Snack Foods Corp
) with a 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
PROCTER & GAMBL (PG): Free Stock Analysis
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