Hormel Foods Stock Climbs on Full-Year Guidance

Hormel Foods (HRL) on Tuesday issued an upbeat outlook for fiscal 2017 and said its fourth-quarter profit rose 22%, boosted by its refrigerated foods segment and Jennie-O Turkey Store brand. The stock was up 3.32% to $36.10 in mid-morning trading today.

The Austin, MN-based owner of Skippy peanut butter and Spam canned meat products sees full-year earnings per share between $1.68 and $1.74. Analysts surveyed by FactSet are projecting earnings of $1.68 per share for fiscal 2017.

"In fiscal 2017, we expect to generate organic sales growth consistent with our long-term goal of five percent coupled with mid-single-digits earnings growth," CEO Jim Snee said in a statement. The results will likely be helped by increasing demand for its Jennie-O Turkey Store and other branded products, such as Skippy peanut butter and its acquisition of Justin's specialty nut butters earlier this year.

The company projects full-year growth internationally through higher exports and improved results from its China business, Snee added. Hormel also raised its fiscal 2017 dividend 17% to 68 cents per share.

For the 2016 fiscal fourth quarter, the company posted earnings of 45 cents per diluted share, in line with the FactSet consensus estimate. Revenue rose 9.5% to $2.63 billion year-over-year, slightly above Wall Street's projections of $2.62 billion.

During the most recent period, its refrigerated foods unit profit jumped 51%, helped by lower costs and "excellent" results from its food-service products such as Hormel pepperoni and Applegate deli meats. Net sales in the segment grew 7.6%. Refrigerated foods accounts for nearly half of Hormel's revenue.

If you liked this article you might like

Jim Cramer on Abercrombie, Dollar Tree, Sears, Burlington, PVH, Hormel, Smuckers, Amazon, Whole Foods and HP

In Retailers' Gang War, This Is Why I Am Rooting for Walmart: Market Recon

Dow Scores Ninth Straight Record Close With Tiny Gains, S&P 500 at All-Time High