NEW YORK (TheStreet) -- Shares of Campbell Soup Co. (CPB) are down -0.48% to $43.74 after the company warned that its sales growth for the upcoming fiscal year would likely fall below its long-term targets and the packaged food company may need to continue reshaping its portfolio to meet its goals, the Wall Street Journal reports.
The company also reaffirmed its previously lowered guidance for its fiscal year that ends August 3, ahead of an investor meeting today.
TheStreet Ratings team rates CAMPBELL SOUP CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate CAMPBELL SOUP CO (CPB) a BUY. This is driven by several positive factors, 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 revenue growth, good cash flow from operations, growth in earnings per share, increase in net income and expanding profit margins. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Despite its growing revenue, the company underperformed as compared with the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- Net operating cash flow has slightly increased to $400.00 million or 9.58% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -11.05%.
- CAMPBELL SOUP CO has improved earnings per share by 11.5% 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, CAMPBELL SOUP CO reported lower earnings of $2.16 versus $2.41 in the prior year. This year, the market expects an improvement in earnings ($2.53 versus $2.16).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Food Products industry average. The net income increased by 1.6% when compared to the same quarter one year prior, going from $181.00 million to $184.00 million.
- 38.98% is the gross profit margin for CAMPBELL SOUP CO which we consider to be strong. Regardless of CPB's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, CPB's net profit margin of 9.34% compares favorably to the industry average.
- You can view the full analysis from the report here: CPB Ratings Report
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