Latest news with #CafeBustelo
Yahoo
07-07-2025
- Business
- Yahoo
Can The J. M. Smucker Overcome Gross Margin Strains in FY26?
The J. M. Smucker Company SJM enters fiscal 2026 under pressure, grappling with gross margin headwinds due to persistent cost inflation, unfavorable product mix and soft volumes. In fourth-quarter fiscal 2025, the company reported a 9% year-over-year decline in adjusted gross profit and an 8% drop in adjusted operating income. These declines were largely attributed to higher costs, reduced sales volume and the lingering impact of recent ahead, The J. M. Smucker expects the fiscal 2026 adjusted gross profit margin to range between 35.5% and 36%. This forecast reflects elevated commodity and manufacturing costs and negative volume/mix. Management also highlighted a roughly 50 basis point (bps) unfavorable impact from tariffs — most notably affecting the U.S. Retail Coffee segment — as a factor contributing to the margin to the pressure, The J. M. Smucker expects its selling, distribution and administrative expenses to rise approximately 3% year over year in fiscal 2026. The increase is primarily caused by elevated marketing investments aimed at supporting key growth brands, particularly Cafe Bustelo and Uncrustables. Total marketing spend is projected to reach 5.7% of net sales, up 30 bps from the prior year. While these investments are intended to fuel long-term growth, they contribute to near-term cost headwinds as The J. M. Smucker navigates a dynamic operating The J. M. Smucker focuses on brand investment and operational efficiency, overcoming margin pressures will require disciplined cost control and sustained consumer demand. Success in navigating these headwinds will be key to restoring profitability and supporting shareholder value in fiscal 2026 and beyond. Investors should monitor margin trends closely as the year progresses. Like The J. M. Smucker, Conagra Brands CAG and Lamb Weston LW are managing inflationary pressures and shifting consumer continues to face elevated protein and input costs, which contributed to a 389 bps adjusted gross margin decline in the third quarter of fiscal 2025. Conagra is focusing on portfolio restructuring, divesting lower-growth assets and investing in high-margin categories like snacks to offset margin Lamb Weston is emphasizing cost efficiency and operational restructuring. The company reported 9% global volume growth in the third quarter of fiscal 2025 and is executing over 30 strategic projects for fiscal 2025, even as its price/mix declined 5% due to strategic pricing adjustments. Lamb Weston aims to drive profitability through network optimization and new customer wins across international and foodservice channels. Shares of SJM have dropped 5.5% in the past year against the industry's growth of 3.1%. Image Source: Zacks Investment Research From a valuation standpoint, SJM trades at a forward price-to-earnings ratio of 11.06X, below the industry's average of 16.01X. Image Source: Zacks Investment Research The Zacks Consensus Estimate for SJM's current fiscal year's earnings implies a year-over-year decline of 8.3%, whereas its next fiscal year's earnings estimate suggests a year-over-year uptick of 7.7%. Image Source: Zacks Investment Research SJM stock currently carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Conagra Brands (CAG) : Free Stock Analysis Report The J. M. Smucker Company (SJM) : Free Stock Analysis Report Lamb Weston (LW) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Bloomberg
13-06-2025
- Business
- Bloomberg
Stock Movers: Halliburton, Smuckers, Oracle
On this episode of Stock Movers: - Halliburton (HAL), along with shares in several energy and oil companies, rose toward the end of the week on heightened tensions in the Middle East. Iran fired hundreds of ballistic missiles against Israel following an unprecedented direct attack on its nuclear facilities, ramping up a conflict between sworn enemies that threatens to engulf the Middle East and disrupt global oil supplies. Multiple waves of missiles targeting Israeli cities amount to the most forceful step yet by Tehran since Israel's overnight raids killed top Iranian generals and badly damaged key military infrastructure. Israel said it identified missiles launched from the Islamic Republic and reported explosions from interceptions and falling debris from incoming projectiles. There was dramatic video footage of at least one large explosion in Tel Aviv, and reports of explosions over Jerusalem. - Smuckers (SJM) declined the most in nearly four decades after saying US tariffs increasing costs in its coffee business will hurt profit, continuing a challenging run for the biggest US packaged food producers. The company, which owns the Folgers and Cafe Bustelo coffee brands, said adjusted earnings this fiscal year will be as much as $9.50 a share. The impact of higher coffee costs and US levies reduced that forecast by roughly $1 a share, Smuckers said. Shares sank 16% on Tuesday in New York, the biggest drop in data compiled by Bloomberg that extends back to 1988. The stock had risen about 1.6% this year through Monday's close, less than the S&P 500 Index's gain of roughly 2%. - Oracle (ORCL) shares soared to a record high after the software maker projected a 70% gain in cloud infrastructure sales this fiscal year, giving a bullish outlook for the closely watched business. The company, long known for its database software, has been gaining traction in its effort to become a major player in the business of cloud computing — renting out computing power and storage — by targeting clients focused on artificial intelligence work. Earlier this year, it announced a joint venture dubbed Stargate to provide OpenAI with massive sums of computing power. The shares gained 13% to $199.85 at the close on Thursday in New York, marking the biggest single-day increase in a year. Oracle had already climbed 17% in the last month as investors grew more optimistic that tariffs and other geopolitical issues wouldn't disrupt the software industry.
Yahoo
28-02-2025
- Business
- Yahoo
JM Smucker Co (SJM) Q3 2025 Earnings Call Highlights: Strong Uncrustables Growth and Strategic ...
Release Date: February 27, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. JM Smucker Co (NYSE:SJM) delivered adjusted earnings per share that exceeded expectations, leading to an increase in full-year adjusted earnings per share and free cash flow guidance. The Uncrustables brand experienced a 15% growth in net sales, driven by national advertising, distribution gains, and new merchandising investments. Cafe Bustelo brand continued its momentum with a 15% growth in net sales, gaining dollar and volume share in every segment it competes in. The company is expanding its product offerings and distribution channels, such as launching new roast profiles for Cafe Bustelo and expanding Uncrustables into convenience stores. JM Smucker Co (NYSE:SJM) is focused on debt reduction, planning to pay down over $800 million this fiscal year and $500 million annually in the next two years, aiming for a leverage ratio at or below 3 times net debt to EBITDA by fiscal year 2027. Supply chain disruptions negatively impacted results, particularly in the Milk-Bone and Meow Mix brands, leading to a $30 million impact in the third quarter. The Sweet Baked Snacks segment underperformed due to inflationary pressures and diminished discretionary income, leading to a $794 million impairment charge related to goodwill. Net sales decreased 2% in the third quarter, with comparable net sales decreasing 1%, driven by declines in coffee and dog snacks. The Hostess brand faced challenges in distribution, merchandising, and competition, causing underperformance in consumer shopping channels. The company revised its full-year net sales expectations due to supply chain disruptions, continued softness in the Sweet Baked Snacks segment, and unfavorable foreign currency exchange impacts. Warning! GuruFocus has detected 3 Warning Signs with SJM. Q: Can you elaborate on the supply chain disruptions and their impact on the quarter's results? A: Mark Smucker, Chairman of the Board, President, Chief Executive Officer, explained that supply chain disruptions negatively impacted results, particularly in the Milk-Bone and Meow Mix brands. However, these issues have been resolved, and the company anticipates returning to full distribution in the fourth quarter. Q: What are the key growth drivers for the Uncrustables brand? A: Mark Smucker highlighted that the Uncrustables brand grew net sales by 15% due to a national advertising campaign, distribution gains, and new merchandising investments. The brand is expanding into convenience stores and has launched new products like the Peanut Butter and Raspberry Spread sandwich, which exceeded expectations. Q: How is the CafA Bustelo brand performing, and what are the future plans? A: Mark Smucker noted that CafA Bustelo is one of the fastest-growing brands in the at-home coffee category, with a 15% increase in net sales. The company plans to expand the brand nationally, introduce new roast profiles, and launch a single-serve ready-to-drink format next fiscal year. Q: What actions are being taken to address the challenges faced by the Hostess brand? A: Mark Smucker stated that the Hostess brand is underperforming due to inflationary pressures and distribution issues. The company is focusing on stabilizing the brand through leadership changes, expanding distribution, driving innovation, and launching new marketing campaigns. Q: Can you provide more details on the financial outlook for fiscal year 2025? A: Tucker Marshall, Chief Financial Officer, mentioned that the company expects full-year net sales to increase by approximately 7.25%, with adjusted earnings per share anticipated to be in the range of $9.85 to $10.15. The company also projects free cash flow of approximately $925 million. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
