The 10-second takeaway
For the quarter ended March 30 (Q3), Hillshire Brands missed estimates on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue dropped significantly. Non-GAAP earnings per share contracted significantly. GAAP earnings per share expanded.
Gross margins contracted, operating margins shrank, net margins grew.
Hillshire Brands booked revenue of $924.0 million. The eight analysts polled by S&P Capital IQ expected to see a top line of $953.3 million on the same basis. GAAP reported sales were 51% lower than the prior-year quarter's $1.90 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.35. The 10 earnings estimates compiled by S&P Capital IQ forecast $0.33 per share. Non-GAAP EPS of $0.35 for Q3 were 65% lower than the prior-year quarter's $1.00 per share. (The prior-year quarter included -$0.34 per share in earnings from discontinued operations.) GAAP EPS were $0.75 for Q3 versus -$0.04 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 29.4%, 180 basis points worse than the prior-year quarter. Operating margin was 7.3%, 300 basis points worse than the prior-year quarter. Net margin was 10.1%, much better than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $1.00 billion. On the bottom line, the average EPS estimate is $0.26.
Next year's average estimate for revenue is $3.99 billion. The average EPS estimate is $1.72.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 295 members out of 368 rating the stock outperform, and 73 members rating it underperform. Among 96 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 78 give Hillshire Brands a green thumbs-up, and 18 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Hillshire Brands is hold, with an average price target of $32.88.
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