As the Q4 earnings season wraps, let’s dig into this quarter’s best and worst performers in the shelf-stable food industry, including Hain Celestial (NASDAQ:HAIN) and its peers.
As America industrialized and moved away from an agricultural economy, people faced more demands on their time. Packaged foods emerged as a solution offering convenience to the evolving American family, whether it be canned goods or snacks. Today, Americans seek brands that are high in quality, reliable, and reasonably priced. Furthermore, there's a growing emphasis on health-conscious and sustainable food options. Packaged food stocks are considered resilient investments. People always need to eat, so these companies can enjoy consistent demand as long as they stay on top of changing consumer preferences. The industry spans from multinational corporations to smaller specialized firms and is subject to food safety and labeling regulations.
The 21 shelf-stable food stocks we track reported a mixed Q4. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 0.5% above.
While some shelf-stable food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 2.9% since the latest earnings results.
Hain Celestial (NASDAQ:HAIN)
Sold in over 75 countries around the world, Hain Celestial (NASDAQ:HAIN) is a natural and organic food company whose products range from snacks to teas to baby food.
Hain Celestial reported revenues of $411.5 million, down 9.4% year on year. This print fell short of analysts’ expectations by 4.4%. Overall, it was a disappointing quarter for the company with a significant miss of analysts’ organic revenue and adjusted operating income estimates.
“Despite challenges in the quarter, we generated strong operating cash flow and further reduced debt. We drove sequential improvement in baby & kids and in our largest category, meal prep. However, sales growth in the quarter was hindered by poor in-store performance in snacks, driven by marketing and promotion effectiveness, and supply chain challenges, both of which we have already taken steps to address. We are confident that the actions taken, combined with promotional timing shifts, confirmed distribution gains, and full infant formula supply, will drive organic net sales growth in the second half of the year," said Wendy Davidson, Hain Celestial President and CEO.
Hain Celestial delivered the weakest performance against analyst estimates and slowest revenue growth of the whole group. The stock is down 7.1% since reporting and currently trades at $4.34.
Read our full report on Hain Celestial here, it’s free.
Best Q4: Lancaster Colony (NASDAQ:LANC)
Known for its frozen garlic bread and Parkerhouse rolls, Lancaster Colony (NASDAQ:LANC) sells bread, dressing, and dips to the retail and food service channels.
Lancaster Colony reported revenues of $509.3 million, up 4.8% year on year, outperforming analysts’ expectations by 2.8%. The business had a very strong quarter with a solid beat of analysts’ EBITDA estimates and an impressive beat of analysts’ adjusted operating income estimates.
Lancaster Colony scored the biggest analyst estimates beat among its peers. The market seems happy with the results as the stock is up 8.1% since reporting. It currently trades at $180.03.
Is now the time to buy Lancaster Colony? Access our full analysis of the earnings results here, it’s free.
Weakest Q4: Lamb Weston (NYSE:LW)
Best known for its Grown in Idaho brand, Lamb Weston (NYSE:LW) produces and distributes potato products such as frozen french fries and mashed potatoes.
Lamb Weston reported revenues of $1.60 billion, down 7.6% year on year, falling short of analysts’ expectations by 4.3%. It was a disappointing quarter as it posted full-year revenue guidance missing analysts’ expectations.
Lamb Weston delivered the weakest full-year guidance update in the group. As expected, the stock is down 38.2% since the results and currently trades at $48.27.
Read our full analysis of Lamb Weston’s results here.
Campbell's (NASDAQ:CPB)
With its iconic canned soup as its cornerstone product, Campbell's (NASDAQ:CPB) is a packaged food company with an illustrious portfolio of brands.
Campbell's reported revenues of $2.69 billion, up 9.3% year on year. This number missed analysts’ expectations by 1.8%. Overall, it was a slower quarter as it also recorded a miss of analysts’ organic revenue estimates and full-year EPS guidance missing analysts’ expectations.
The stock is down 4.4% since reporting and currently trades at $38.54.
Read our full, actionable report on Campbell's here, it’s free.
TreeHouse Foods (NYSE:THS)
Whether it be packaged crackers, broths, or beverages, Treehouse Foods (NYSE:THS) produces a wide range of private-label foods for grocery and food service customers.
TreeHouse Foods reported revenues of $905.7 million, flat year on year. This print was in line with analysts’ expectations. Zooming out, it was a slower quarter as it recorded EBITDA guidance for next quarter missing analysts’ expectations and a miss of analysts’ gross margin estimates.
The stock is down 14% since reporting and currently trades at $28.59.
Read our full, actionable report on TreeHouse Foods here, it’s free.
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