Smithfield Foods Earnings Preview

Smithfield Foods (NYSE: SFD  ) will try to beat its earnings estimates for the fourth consecutive quarter. The company will unveil its latest earnings on Thursday. Smithfield Foods is a hog producer and pork processor that produces and markets a number of fresh and packaged meats products both domestically and internationally.

What analysts say:

• Buy, sell, or hold?: Analysts strongly back Smithfield Foods, with eight of 14 rating it a buy and the remainder rating it a hold. Analysts don't like Smithfield Foods as much as competitor Pilgrim's Pride overall. Wall Street has warmed to the stock over the past three months, with analysts increasing their endorsement from hold to moderate buy.
• Revenue forecasts: On average, analysts predict $3.21 billion in revenue this quarter. That would represent a rise of 7% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.69 per share. Estimates range from $0.48 to $0.95.

What our community says:
CAPS All-Stars are solidly backing the stock with 86% giving it an outperform rating. The community at large backs the All-Stars with 83.8% awarding it a rating of outperform. Fools are keen on Smithfield Foods and haven't been shy with their opinions lately, logging 116 posts in the past 30 days. Despite the majority sentiment in favor of Smithfield Foods, the stock has a middling CAPS rating of three out of five stars.

Management:
Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q1	Q4	Q3	Q2
Gross Margin	13.2%	14.6%	14.3%	14.4%
Operating Margin	5.6%	8.6%	11.7%	9.3%
Net Margin	2.7%	3.2%	6.4%	4.8%

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Earnings estimates provided by Zacks