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Higher Costs Eat into General Mills’ Q2 Earnings (GIS)

Packaged foods maker General Mills, Inc. ( GIS ) on Tuesday said its fiscal second quarter earnings plunged 28% from last year due to higher input costs.

The Minneapolis-based company reported fiscal second quarter net income of $444.8 million, or 67 cents per share, compared with $613.9 million, or 92 cents per share, in the year-ago period. Excluding one-time items, adjusted profit was 76 cents per share.

Sales rose 14% from last year to $4.62 billion, as the company was able to partially offset higher costs by raising prices on key products.

On average, Wall Street analysts expected a higher profit of 79 cents per share, albeit on slightly lower revenue of $4.6 billion.

Looking ahead, GIS reaffirmed its full-year 2012 earnings outlook for profits of $2.59 to $2.61 per share, excluding items, while analysts are looking for $2.61 per share.

General Mills shares fell $1.24, or -3.1%, in premarket trading Tuesday.

The Bottom Line

Shares of General Mills ( GIS ) have a 3.08% dividend yield, based on last night's closing stock price of $39.59. The stock has technical support in the $37-$38 price area. The shares are trading near all-time highs and have little overhead resistance.

General Mills, Inc. ( GIS ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

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

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

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