NEW YORK (TheStreet) -- ConAgra Foods (CAG - Get Report)
ConAgra Foods, North America's largest packaged food companies, is trading 0.10% higher to $30.40, as of 3:25 p.m. ET, following its board of directors approving a 25-cent dividend payment to be paid to stockholders on December 3.
TheStreet Ratings team rates ConAgra Foods as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate ConAgra Foods (CAG) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, reasonable valuation levels and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had subpar growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth greatly exceeded the industry average of 4.1%. Since the same quarter one year prior, revenues rose by 27.2%. This growth in revenue does not appear to have trickled down to the company's bottom line.
- ConAgra Foods' earnings per share declined by 45.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ConAgra Foods increased its bottom line by earning $1.86 a share vs. $1.11 in the prior year. This year, the market expects earnings of $2.33 a share.
- Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. The stock's price rise over the last year has driven it to a level which is somewhat expensive compared to the rest of its industry. We feel, however, that other strengths this company displays justify these higher price levels.
- The gross profit margin for ConAgra Foods is rather low; currently it is at 23.28%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 3.43% trails that of the industry average.
- You can view the full analysis from the report here: CAG Ratings Report