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2022-06-08 20:02

Shares of Campbell Soup Co closed 2.0% up on Wednesday after the company reported its fiscal third-quarter results that beat analysts’ expectations. The processed foods and snacks company also raised full-year sales guidance well above the FactSet consensus.

Campbell Q3 Financial Highlights

The following results are compared to the third quarter fiscal 2021.

• Net income jumped 18% to $188.0 million

• Earnings per share on adjusted basis shot up 37% to $0.70

• Net sales of $2.130 billion represent a 7.0% growth

FactSet consensus for adjusted EPS was $0.61 with $2.042 billion in net sales. In the earnings press release, CEO Mark Clouse said:

“As expected, we had a strong recovery across the business in the quarter with high-single-digit sales growth driven by sustained consumer demand for our brands and significantly improved supply. Our improved supply chain execution along with inflation-driven pricing began to mitigate the margin pressure we have experienced over the last 12 months.”

Other Prominent Figures

Other notable figures in the earnings report include a 6% year-over-year increase in net sales from Meals and Beverages and 8% increase from Snacks.

The Camden-headquartered company saw a strong demand for products with a 4% increase in consumption versus prior year, and foresees a 14% growth on a three-year basis. Organic sales increased 9%, while gross margin decreased 31.2% from 31.7% in the prior year.

Campbell’s Outlook for 2022

Campbell now forecasts its sales to grow by up to 1% this year versus prior guidance for an up to 2% decline. It guided for earnings per share on an adjusted basis in the range of $2.75 to $2.85 for fiscal 2022.
In comparison, FactSet consensus is a 0.8% decrease in sales to $8.411 billion, and adjusted EPS of $2.78 for the year. The CEO added:

“While the operating environment remains challenging and we continue to expect significant inflation, our team is executing well, and Campbell is on a much stronger foundation today. Looking ahead, we are raising our full-year fiscal 2022 net sales outlook and reaffirming our prior adjusted EBIT and adjusted EPS guidance reflecting the on-going inflation-driven margin pressure.”

The 14.27 billion company that trades at a PE ratio of 15.61 is currently up roughly 8% for the year. Wall Street currently rates Campbell Soup at “hold” with an average price target of $45 a share.