The Smithfield Packing Company, which is a subsidiary of
leading meat producer
Smithfield Foods, Inc.
), recently announced plans to stop production of bone-in ham at
its plant in Landover, Md as the facility failed to fulfill
fast-changing production needs. The bone-in ham production will
now be shifted to Smithfield's facilities in North Carolina and
Thereafter, Smithfield will shut down the Landover plant by
early fall, thus impacting about 175 workers. However, the
company will employ some of the employees at other
Recently, Smithfield has been focusing on improving its
product mix in differentiated, branded and value-added products,
both domestically and in the export markets. Smithfield is also
increasing its focus on consumer convenience by introducing more
We believe that Smithfield's continued focus on brand building
investments and innovation, improving packaged meat margins,
driven by favorable product mix and increased marketing of its
core brands and production of healthier products are expected to
benefit earnings in the upcoming quarter.
Smithfield reported better-than-expected earnings of 58 cents
in early March. Total sales also beat the Zacks Consensus
Estimate and increased 3.0% year over year to $3.6 billion.
Strong momentum in packaged meat business, solid contribution
from international operations and volume growth in all the
categories drove fiscal third quarter 2013 results.
However, Smithfield expects weak business from the Hog
Production segment in fiscal 2013 but remains positive toward the
its risk management strategy, which we believe will help in
limiting the impact of rising grain costs thus make the segment
Currently the stock carries a Zacks Rank #3 (Hold). Some other
meat producing companies that are performing well
Hillshire Brands Company
Tyson Foods Inc.
Pilgrim's Pride Corp
). Hillshire Brands and Pilgrim's Pride hold a Zacks Rank #1
(Strong Buy), while Tyson carries a Zacks Rank #2 (Buy).
HILLSHIRE BRAND (HSH): Free Stock Analysis
PILGRIMS PRIDE (PPC): Free Stock Analysis
SMITHFIELD FOOD (SFD): Free Stock Analysis
TYSON FOODS A (TSN): Free Stock Analysis
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