NEW YORK (TheStreet) -- Shares of Post Holdings Inc. (POST) are lower by 2.11% to $35.30 in early afternnon trading on Wednesday, as consumer food stocks slump due to General Mills' (GIS) weak earnings results for the fiscal 2015 first quarter.
General Mills reported a decline in net income for the most recent quarter to $345.2 million, or 55 cents per share compared to $459.3 million, or 70 cents per share for the fiscal 2014 first quarter.
Adjusted earnings per share dropped to 61 cents from 70 cents for the year ago quarter, analysts expected EPS of 69 cents for the fiscal 2015 first quarter.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
Other consumer food stocks falling as a result include Kellogg Co. (K) , lower by 1.68% to $62.80, ConAgra Foods Inc. (CAG) , down by 1.20% to $31.98, and Tyson Foods Inc. (TSN) , lower by 1.97% to $38.31.
Separately, TheStreet Ratings team rates POST HOLDINGS INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate POST HOLDINGS INC (POST) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- POST's very impressive revenue growth greatly exceeded the industry average of 3.2%. Since the same quarter one year prior, revenues leaped by 146.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- Net operating cash flow has increased to $56.00 million or 17.64% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 2.02%.
- The share price of POST HOLDINGS INC has not done very well: it is down 13.24% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
- POST HOLDINGS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last year. We anticipate that this should continue in the coming year. During the past fiscal year, POST HOLDINGS INC reported lower earnings of $0.29 versus $1.44 in the prior year. For the next year, the market is expecting a contraction of 243.1% in earnings (-$0.42 versus $0.29).
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Food Products industry. The net income has significantly decreased by 1132.3% when compared to the same quarter one year ago, falling from $3.40 million to -$35.10 million.
- You can view the full analysis from the report here: POST Ratings Report
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