Zacks Investment Research downgraded
) to a Zacks Rank #5 (Strong Sell) on Feb 8, 2014.
Why the Downgrade?
INTL F & F (IFF): Free Stock Analysis
NEWMARKET CORP (NEU): Free Stock Analysis
PENFORD CORP (PENX): Free Stock Analysis
SENSIENT TECH (SXT): Free Stock Analysis
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Penford Corporation reported disappointing financial results for
the fiscal first quarter of 2014 (ended Nov 30, 2013) on Jan 9,
2014. Since then the company's share price has plunged 15%.
A brief snapshot of Penford's financial results has been provided
Earnings per share in the quarter were 4 cents, way below 14
cents earned in the year-ago quarter. Sales declined by 7.4%
primarily due to an 11% fall in the company's Industrial
Ingredients revenue, offset partially by a 3.6% increase in Food
Despite the 6% decline in cost of sales, lower revenues pulled
down gross profit by 19%. Gross margin in the quarter was 9.8%,
down 140 basis points year over year while operating margin was
1.4%, down 190 basis points year over year.
Weak fiscal first quarter 2014 results as well as a negative
average earnings surprise of 83.8% make us pessimistic of fiscal
second quarter 2014 results. Also, in the last 30 days, the Zacks
Consensus Estimate for Penford has decreased by 13.3% to 65 cents
for fiscal 2014 (ending Aug 2014) and by 5% to 95 cents for
Other Stocks to Consider
Penford Corporation is a $139 million company operating in the
specialty chemicals industry. Some better-ranked stocks in the
International Flavors & Fragrances Inc.
Sensient Technologies Corp.
). All these companies hold a Zacks Rank #2 (Buy).