Smithfield Foods (NYSE: SFD) beat estimates by 17 cents last quarter and investors are hoping it can beat them again. The company will unveil its latest earnings on Thursday, June 16. Smithfield Foods is a hog producer and pork processor. The company produces and markets a number of fresh and packaged meat products both domestically and internationally.

What analysts say:

  • Buy, sell, or hold?: Analysts think investors should stand pat on Smithfield Foods -- eight of 15 analysts rating the stock a hold. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
  • Revenue Forecasts: On average, analysts predict $3.24 billion in revenue this quarter. That would represent a rise of 11.3% from the year-ago quarter.
  • Wall St. Earnings Expectations: The average analyst is estimating earnings of 83 cents per share. Estimates range from 75 cents to 91 cents.

What our community says:
CAPS All Stars are solidly behind the stock with 87.8% assigning it an "outperform" rating. The community at large concurs with the All Stars --81.4% give it a rating of "outperform." Fools are bullish on Smithfield Foods and haven't been shy with their opinions lately, logging 106 posts in the past 30 days. Still, Smithfield has a three-star CAPS rating (out of five), falling short of the Fool community enthusiasm for the stock.

Revenue has now gone up for three straight quarters. In the third quarter of the last fiscal year, revenue rose 11.4% to $3.19 billion while the figure rose 6.9% in second quarter from the year earlier. The company increased its gross margin by 4.5 percentage points in the last quarter. Revenue rose 10.5% while cost of sales rose 4.9% to $2.73 billion from a year earlier.

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 and net margins over the past four quarters. 

Quarter Q3 Q2 Q1 Q4
Gross Margin 14.3% 14.4% 12.7% 6.1%
Net Margin 6.4% 4.8% 2.6% -0.2%

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