NEW YORK (TheStreet) -- Kellogg (K) shares are down 0.17% to $66.51 in early market trading on Wednesday after private equity firm Abraaj Group withdrew a competing bid for Egyptian snack maker Bisco Misr, the firm announced today.
While Abraaj did not give a specific reason for the withdrawal of its offer, its last bid of 88.09 Egyptian pounds per share, or about $142 million, was trumped by Kellog's offer of 89.86 Egyptian pounds per share.
On Monday, Egypt's financial regulator extended the bidding period for the company to January 11. The bidding war between the two company's had driven up the company's purchase price by about 20% from the original 73.91 pounds per share offer.
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TheStreet Ratings team rates KELLOGG CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate KELLOGG CO (K) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its notable return on equity, increase in stock price during the past year and expanding profit margins. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Food Products industry and the overall market, KELLOGG CO's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. Looking ahead, unless broad bear market conditions prevail, we still see more upside potential for this stock, despite the fact that it has already risen over the past year.
- 41.28% is the gross profit margin for KELLOGG CO which we consider to be strong. Regardless of K's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 6.15% trails the industry average.
- K, with its decline in revenue, slightly underperformed the industry average of 1.7%. Since the same quarter one year prior, revenues slightly dropped by 2.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- KELLOGG CO's earnings per share declined by 31.1% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, KELLOGG CO increased its bottom line by earning $4.95 versus $2.68 in the prior year. For the next year, the market is expecting a contraction of 21.0% in earnings ($3.91 versus $4.95).
- You can view the full analysis from the report here: K Ratings Report