For Immediate Release
Chicago, IL - March 20, 2012 - Zacks.com announces the list of
stocks featured in the Analyst Blog. Every day the Zacks Equity
Research analysts discuss the latest news and events impacting
stocks and the financial markets. Stocks recently featured in the
blog include
Procter & Gamble
(
PG
),
Unilever Plc.
(
UL
),
Kellogg Company
(
K
),
Diamond Foods
(
DMND
) and
General Mills Inc.
(
GIS
).
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free Profit from the Pros newsletter:
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Here are highlights from Monday's Analyst Blog:
P&G to Build Huge Plant in China
The world's leading consumer product giant
Procter & Gamble
(
PG
) is set to further spread its roots across China, the world's
fastest growing market. P&G has started construction of a
manufacturing plant in Luogang, Guangzhou that is being hailed as
one of the largest manufacturing sites in Asia.
The new manufacturing plant is expected to add $490 million of
production value to the consumer giant every year. The plant, which
will come up in 3 stages, is set to begin its first-stage
operations by the second half of 2013. The first stage will produce
a variety of goods including its signature Pampers diapers.
The new initiative is a part of the company's goal to invest as
much as $1 billion in China by 2015. As the western world is
becoming increasingly saturated, the retail giants are looking more
and more towards the eastern world for finding emerging untapped
markets.
P&G's hardcore rival
Unilever Plc.
(
UL
) is also not leaving any stone unturned to capture the fast
growing market in China. Almost simultaneously with P&G,
Unilever has started constructing one of its largest production
operations, covering nearly 27 hectares, in the Binhai New Area, a
business district in Tianjin. The new plant will make liquid
laundry detergent and fabric softeners.
In 2009, P&G announced its goal to bring one billion new
customers to the firm by the 2014-15 fiscal years. P&G's
relation with China dates back to 1980, when, in spite of huge
skepticism, the retailer introduced its anti-dandruff shampoo 'Head
& Shoulders' in the country. Till then there was no
anti-dandruff shampoo in the Chinese market. P&G's launch of
the anti-dandruff shampoo was a huge success and thereafter the
company launched diapers in China.
P&G has announced plans to add around 20 manufacturing
plants between 2010 and 2015 in countries like Brazil, China, South
Africa, Romania and Poland.
However, last month P&G announced its decision to slash over
4,000 non-manufacturing jobs in US during the current fiscal year.
This declaration follows the already planned 1,600 job cuts,
announced by the company at the beginning of February 2012.
P&G anticipates that by trimming down 5,700 jobs, it will
save up to $10 billion of cost, including $1 billion in marketing
costs and $3 billion in overhead costs, by the end of the fiscal
year ending in June 2016.
P&G also managed to shed its Pringles potato chips business
by striking a $2.7 billion deal with
Kellogg Company
(
K
), after its earlier plan fell apart when
Diamond Foods
(
DMND
), the original buyer, became embroiled in some accounting
problems.
Currently P&G holds a Zacks #4 Rank (short-term Sell
rating). Over the long-term, we maintain a Neutral recommendation
on the stock.
Earnings Preview: General Mills
General Mills Inc.
(
GIS
), one of the leading branded foods companies in the US, is
scheduled to report its third-quarter 2012 financial results before
the opening bellon Wednesday, March 21, 2012. The current Zacks
Consensus Estimate for the quarterly earnings is pegged at 56 cents
a share.
Consensus Estimates for Third Quarter 2012
Analysts surveyed by Zacks expect General Mills to post
third-quarter 2012 earnings of 56 cents a share, which is in line
with the prior-year quarter. Analyst estimates for the quarter
range from a low of 54 cents to a high of 60 cents.
The current Zacks Consensus Estimate has slipped by 10.0% over
the last 30 days; as 9 out of 11 analysts covering the stock
revised their estimates downward.
Earnings Surprise History
General Mills' earnings per share exceeded the Zacks Consensus
Estimate inthree of the last four quarters. In those four quarter,
earnings surprise ranged from a negative 3.80% to a positive 3.23%,
with the average earnings surprise being a negative 0.29%,
suggesting that General Mills has underperformed the Zacks
Consensus Estimate by that magnitude over that period.
Retains Neutral Recommendation
General Mills has an outstanding portfolio of products and
brands, especially its healthy and convenience packages, helping in
the company's growth. Through the Holistic Margin Management (HMM)
program, the company manages costs and abates inflation, thus
improving margins and gaining over its peers.
However, the company faces stiff competition from rival retail
giants as well as from local and regional players in the countries
in which it operates. Consequently, the company is under severe
pressure to maintain profitability and increase market share.
Currently we maintain a Zacks #3 Rank (Hold), in line with our
long-term Neutral recommendation on the shares.
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DIAMOND FOODS (
DMND
): Free Stock Analysis Report
GENL MILLS (
GIS
): Free Stock Analysis Report
KELLOGG CO (
K
): Free Stock Analysis Report
PROCTER & GAMBL (
PG
): Free Stock Analysis Report
UNILEVER PLC (
UL
): Free Stock Analysis Report
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