Hormel Foods Corporation HRL is likely to register a decline in its top and bottom lines when it reports first-quarter fiscal 2025 earnings on Feb. 27. The Zacks Consensus Estimate for quarterly earnings has moved down by a penny in the last 30 days to 38 cents per share, indicating a decrease of 7.3% from the year-ago quarter’s reported figure. The Zacks Consensus Estimate for quarterly revenues is pegged at $2.9 billion, which indicates an almost 2% decrease from the year-ago quarter. HRL has a trailing four-quarter earnings surprise of 7.4%, on average.
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Things to Know About HRL’s Upcoming Results
Hormel Foods has been facing rising selling, general and administrative (SG&A) expenses for some time now. The company is dealing with increased employee-related costs and expenses linked to its Transform and Modernize (T&M) initiative. Looking ahead, management has projected a further rise in SG&A expenses and an increase in advertising spending for fiscal 2025, which is likely to have impacted the company’s profitability in the to-be-reported quarter.
In addition, the production disruption at Hormel Foods’ Planters facility in Suffolk, VA, has posed a significant challenge, affecting the company’s ability to meet demand for its snack nuts portfolio. Although the company has made progress in addressing the disruption, it anticipates some near-term commercial impacts and increased costs, particularly in the fiscal first quarter. Management expects a negative earnings per share (EPS) impact of 4-5 cents in the quarter, primarily due to lower year-over-year whole bird prices and the Suffolk production disruption.
Hormel Foods Corporation Price and EPS Surprise
Hormel Foods Corporation price-eps-surprise | Hormel Foods Corporation Quote
Despite these challenges, Hormel Foods' commitment to innovation has bolstered its market position, while the T&M initiative is aimed at enhancing production efficiency and supply-chain management. Growing demand for Foodservice products has been offering respite.
Earnings Whispers for HRL
Our proven model predicts an earnings beat for Hormel Foods this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Hormel Foods carries a Zacks Rank #3 and has an Earnings ESP of +0.66%.
Other Stocks With the Favorable Combination
Here are some other companies worth considering, as our model shows that these too have the right combination of elements to beat on earnings this reporting cycle.
Costco Wholesale COST currently has an Earnings ESP of +0.14% and a Zacks Rank of 2. The company is likely to register growth in its top and bottom lines when it reports second-quarter fiscal 2025 numbers. The Zacks Consensus Estimate for Costco’s quarterly revenues is pegged at $63.2 billion, which suggests 8.2% growth from the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Costco’s quarterly earnings per share is pegged at $4.09, indicating a 10.2% increase from the year-ago period. COST has a trailing four-quarter earnings surprise of 2%, on average.
Home Depot HD currently has an Earnings ESP of +1.29% and a Zacks Rank of 3. The company is likely to register growth in its top and bottom lines when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for Home Depot’s quarterly revenues is pegged at $39.14 billion, which suggests an increase of 12.5% from the prior-year quarter.
The Zacks Consensus Estimate for Home Depot’s quarterly earnings per share is pegged at $3.04, indicating 7.8% growth from the year-ago period. HD has a trailing four-quarter earnings surprise of 2.3%, on average.
Grocery Outlet Holding GO currently has an Earnings ESP of +1.32% and a Zacks Rank of 3. The company is likely to register a decrease in the bottom line when it reports fourth-quarter 2024 numbers. The Zacks Consensus Estimate for the quarterly earnings per share is pegged at 17 cents, down 5.6% from the year-ago period. GO has a trailing four-quarter negative earnings surprise of 2.2%, on average.
Grocery Outlet's top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.09 billion, which suggests an increase of 9.7% from the prior-year quarter.
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Hormel Foods Corporation (HRL) : Free Stock Analysis Report
Grocery Outlet Holding Corp. (GO) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
