Dean Foods Company
) is scheduled to report its second-quarter 2014 results on Aug 11.
Last quarter, this global consumer products company posted a
negative earnings surprise of approximately 350%. Let's see how
things are shaping up for this announcement.
Factors Influencing the Upcoming Results
Dean Foods continues to suffer because of the high raw milk prices,
which has been impacting the company's quarterly performance for
quite some time now. The raw milk cost of Class I Mover registered
a year-over-year increase of 22% in the last quarter and touched an
all-time quarterly high of $22.38 per hundred-weight. The company
has posted lower-than-expected earnings for the trailing four
quarters. Further, it still expects high raw milk prices along with
weak volumes in 2014.
Therefore, the company has lowered its earnings guidance for 2014
to 60 cents per share from the earlier projected range of 73-86
cents per share. Furthermore, Dean Foods expects to report adjusted
loss in the range of 2-8 cents per share for the second-quarter of
2014. Agreeing with the company's projections for weak volumes and
higher prices through the rest of 2014, we expect the company's
results for the second quarter to be bleak.
Our proven model does not conclusively project Dean Foods as likely
to beat earnings this quarter. A stock needs to have both a
and a Zacks Rank #1, 2 or 3 to surpass earnings estimates. However,
this is not the case here due to the following factors:
ESP for Dean Foods is 0.00% since the Most Accurate estimate stands
at a loss of 5 cents per share, which is in line with the Zacks
Zacks Rank #4 (Sell):
Dean Foods' Zacks Rank #4 when combined with a zero ESP makes
surprise prediction unlikely. Moreover, 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.
Other Stocks to Consider
Here are some companies you may want to consider as our model shows
that the following stocks have the right combination of elements to
post an earnings beat:
Pinnacle Foods Inc.'s (
) Earnings ESP stands at +3.03% and it carries a Zacks Rank #2
Macy's Inc. (
) with an Earnings ESP of +1.16% carries a Zacks Rank #3 (Hold).
L Brands Inc. (
) with an Earnings ESP of +1.64% carries a Zacks Rank #3.
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MACYS INC (M): Free Stock Analysis Report
DEAN FOODS CO (DF): Free Stock Analysis Report
PINNACLE FOODS (PF): Free Stock Analysis Report
L BRANDS INC (LB): Free Stock Analysis Report
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