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Shelf-Stable Food Stocks Q1 Highlights: Mondelez (NASDAQ:MDLZ)


Petr Huřťák /
2024/06/11 2:46 am EDT

The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Mondelez (NASDAQ:MDLZ) and the rest of the shelf-stable food stocks fared in Q1.

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 decent Q1; on average, revenues beat analyst consensus estimates by 0.5%. while next quarter's revenue guidance was 1.6% below consensus. Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance due to mixed inflation data, and while some of the shelf-stable food stocks have fared somewhat better than others, they collectively declined, with share prices falling 1.8% on average since the previous earnings results.

Mondelez (NASDAQ:MDLZ)

Founded as Nabisco in 1903, Mondelez (NASDAQ:MDLZ) is a packaged snacks powerhouse best known for its Oreo, Cadbury, Toblerone, Ritz, and Trident brands.

Mondelez reported revenues of $9.29 billion, up 1.4% year on year, topping analysts' expectations by 1.5%. It was a very strong quarter for the company, with revenue and EPS exceeding analysts' estimates.

“We posted solid top-line results coupled with robust earnings and free cash flow generation in the first quarter driven by strong pricing execution, effective cost management and emerging market momentum,” said Dirk Van de Put, Chair and Chief Executive Officer.

Mondelez Total Revenue

The stock is down 5.9% since the results and currently trades at $67.69.

Is now the time to buy Mondelez? Access our full analysis of the earnings results here, it's free.

Best Q1: Hershey (NYSE:HSY)

Best known for its milk chocolate bar and Hershey's Kisses, Hershey (NYSE:HSY) is an iconic company known for its chocolate products.

Hershey reported revenues of $3.25 billion, up 8.9% year on year, outperforming analysts' expectations by 4.5%. It was a stunning quarter for the company, with an impressive beat of analysts' gross margin and EPS estimates.

Hershey Total Revenue

The stock is down 2.2% since the results and currently trades at $191.59.

Is now the time to buy Hershey? Access our full analysis of the earnings results here, it's free.

Weakest Q1: 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 $1.46 billion, up 16.3% year on year, falling short of analysts' expectations by 11.8%. It was a weak quarter for the company, with full-year revenue guidance missing analysts' expectations and a miss of analysts' operating margin estimates.

Lamb Weston had the weakest performance against analyst estimates and weakest full-year guidance update in the group. The stock is down 15.1% since the results and currently trades at $85.72.

Read our full analysis of Lamb Weston's results here.

General Mills (NYSE:GIS)

Best known for its portfolio of powerhouse breakfast cereal brands, General Mills (NYSE:GIS) is a packaged foods company that has also made a mark in cereals, baking products, and snacks.

General Mills reported revenues of $5.10 billion, down 0.5% year on year, surpassing analysts' expectations by 2.7%. It was a solid quarter for the company, with an impressive beat of analysts' organic revenue growth estimates and a decent beat of analysts' earnings estimates.

The stock is down 1.9% since the results and currently trades at $67.35.

Read our full, actionable report on General Mills here, it's free.

Kellanova (NYSE:K)

With Corn Flakes as its first and most iconic product, Kellanova (NYSE:K) is a packaged foods company that is dominant in the cereal and snack categories.

Kellanova reported revenues of $3.2 billion, down 4.2% year on year, surpassing analysts' expectations by 1.3%. It was a weaker quarter for the company, with a miss of analysts' gross margin estimates.

The stock is up 3.6% since the results and currently trades at $59.01.

Read our full, actionable report on Kellanova here, it's free.

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