Will Campbell (CPB) Miss Earnings Estimates? - Analyst Blog


Campbell Soup Co. ( CPB ), the manufacturer of high-quality foods and simple meals, is slated to report second-quarter fiscal 2014 results on Feb 14, 2014. In the last quarter, it posted a negative surprise of 24.1%. Let us see how things are shaping up for this announcement.

Factors this Past Quarter

Campbell Soup posted lower-than-expected first-quarter fiscal 2014 results. The company's quarterly results were primarily suffered due to the late Thanksgiving holiday, weakness in core business categories, higher marketing expenses and recall of Plum Organics pouch products. Disappointed with its first-quarter performance, Campbell Soup lowered its adjusted earnings growth guidance range for fiscal 2014 to 2%-4% from 3%-5% forecasted earlier.

Earnings Whispers?

Our proven model does not conclusively show that Campbell Soup is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1, 2 or 3 for this to happen. This is not the case here, as you will see below.

Negative Zacks ESP: ESP for Campbell Soup is -2.74%. This is because the Most Accurate estimate stands at 71 cents, while the Zacks Consensus Estimate is pegged at 73 cents.

Zacks Rank #4 (Sell): Campbell Soup's Zacks Rank #4 when combined with a negative ESP makes surprise prediction difficult. We caution against stocks with a Zacks Ranks #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions momentum.

Stocks that Warrant a Look

Here are some other companies you may want to consider as our model shows they have the right combination of elements:

ConAgra Foods, Inc. ( CAG ) with anEarnings ESP of +1.54% and a Zacks Rank #2 (Buy).

J&J Snack Foods Corp. ( JJSF ) with an Earnings ESP of +2.67% and a Zacks Rank #2 (Buy).

Cabela's Incorporated ( CAB ) with an Earnings ESP of +2.13% and a Zacks Rank #3 (Hold).

CABELAS INC (CAB): Free Stock Analysis Report

CONAGRA FOODS (CAG): Free Stock Analysis Report

CAMPBELL SOUP (CPB): Free Stock Analysis Report

J&J SNACK FOODS (JJSF): Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: CAB , CAG , CPB , JJSF



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