Latest news with #ConsumerSegment
Globe and Mail
5 days ago
- Business
- Globe and Mail
VZ Rides on Healthy Traction in the Consumer Segment: Will it Persist?
Verizon Communications Inc. 's VZ business has been gaining solid traction in the Consumer segment, backed by some major growth drivers. As of first-quarter 2025, the company's wireless retail connections were 115.1 million, with wireless retail postpaid connections being 94.9 million. Core prepaid connections were 19 million. Service revenues improved to $20.8 billion, up 2.7% year over year, while equipment revenues were $4.5 billion. A retail postpaid phone churn of 0.9% indicates healthy customer retention. The company's wireless retail postpaid ARPA was $146.46 at the end of the first quarter, up 3.6% year over year. It is steadily building the entire network infrastructure and ecosystem to provide the most amazing 5G experience to customers. The company has witnessed increased adoption of 5G devices and premium unlimited plans. Verizon's customer segmentation strategy, which categorizes different client groups, helps it deliver tailored solutions to different sectors. Such personalized offerings help in client retention, drive average revenue per account growth. VZ's effective customer-focused strategy, combined with a strong 5G network, is a major tailwind. Its three-year price lock guarantee will ensure the core monthly plan price for calling, data and texting will not change in the next three-year period, excluding taxes, fees and perks. The company also introduced cutting-edge AI-native features to boost customer service. Such initiatives are driving customer engagement. Moreover, the company's C-Band spectrum offers greater coverage for 5G networks and greater speeds than on low-band spectrum and paves the way to provide differentiated service of 5G Ultra-Wideband to millions of customers. Steady growth in wireless equipment revenues is expected to drive improvement in this segment. Per our estimate, the company is expected to record $20.93 billion in revenues in 2025 from wireless equipment sales, indicating healthy 6.8% year-over-year growth. Per our estimate, wireless retail postpaid ARPA is projected to reach $151.49, indicating 9.6% year-over-year growth. How Are Competitors Faring? Verizon operates in a highly competitive and saturated U.S. wireless market. It faces significant competition from T-Mobile, US, Inc. TMUS and AT&T, Inc. T. T-Mobile continues to boast a leadership position in the 5G market. Its Ultra Capacity 5G delivers superfast speeds, powering 5G smartphones and enabling innovators to deliver transformational 5G experiences. During the first quarter, T-Mobile's postpaid phone churn rate was 0.91%. AT&T is investing in key areas of 5G and fiber and adjusting its business according to the evolving market scenario to fuel long-term growth. With a customer-centric business model, AT&T is witnessing healthy momentum in its postpaid wireless business with a lower churn rate and increased adoption of higher-tier unlimited plans. The company reported a postpaid churn of 0.83% in the first quarter of 2025. VZ's Price Performance, Valuation and Estimates Verizon has gained 4.8% over the past year compared with the Wireless National industry's growth of 26.6%. Going by the price/earnings ratio, the company's shares currently trade at 9.06 forward earnings, down from 13.57 for the industry but above the stock's mean of 8.98. It carries a Value Score of A. Earnings estimates for 2025 have remained unchanged at $4.69 over the past 60 days, while the same for 2026 has improved 1.23% at $4.92. Verizon currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> 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 AT&T Inc. (T): Free Stock Analysis Report Verizon Communications Inc. (VZ): Free Stock Analysis Report T-Mobile US, Inc. (TMUS): Free Stock Analysis Report
Yahoo
27-06-2025
- Business
- Yahoo
McCormick & Co Inc (MKC) Q2 2025 Earnings Call Highlights: Navigating Growth Amidst Global ...
Total Organic Sales Growth: Increased by 2% for the quarter, driven by volume and mix. Consumer Segment Organic Sales: Increased by 3%, with 4% volume growth in the Americas. Flavor Solutions Segment Organic Sales: Flat, with a 1% contribution from price offset by a 1% decline in volume and mix. Gross Profit Margin: Flat compared to the previous year, impacted by higher commodity costs. Adjusted Operating Income: Increased by 10%, or 11% excluding currency impacts. Adjusted Earnings Per Share: $0.69, comparable to the previous year. Cash Flow from Operations: $161 million, down from $302 million in the previous year. Capital Expenditures: $85 million used for capital expenditures. Tariff Exposure: Total gross annualized tariff exposure approximately $90 million, with $50 million in-year exposure for 2025. 2025 Financial Outlook: Net sales growth expected between 1% and 3%, with adjusted EPS projected at $3.03 to $3.08. Warning! GuruFocus has detected 5 Warning Signs with MKC. Release Date: June 26, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. McCormick & Co Inc (NYSE:MKC) reported a 2% increase in total organic sales for the second quarter, driven by volume growth, particularly in the Consumer segment. The company achieved volume growth of more than 3% in the Consumer segment, with strong performance in the Americas and EMEA regions. McCormick & Co Inc (NYSE:MKC) continues to see strong demand for its products, driven by consumer trends towards flavorful, fresh, and healthy meals. The company is effectively managing tariff impacts through strategic sourcing and cost-saving initiatives, maintaining its volume-led growth and operating profit outlook for 2025. McCormick & Co Inc (NYSE:MKC) is expanding its distribution and launching new products, such as air fryer seasonings and finishing salts, to drive growth and meet consumer demand. The Flavor Solutions segment experienced a decline in volume, particularly in the EMEA region, due to softness in customer volumes and geopolitical boycotts. The company faces increased cost pressures from the global trade environment, impacting its gross margin expectations for 2025. McCormick & Co Inc (NYSE:MKC) is experiencing softness in volumes from some large CPG customers, affecting its Flavor Solutions segment. The company anticipates continued challenges in the quick service restaurant (QSR) sector in EMEA, impacting its performance in that region. McCormick & Co Inc (NYSE:MKC) reported a decrease in cash flow from operations compared to the previous year, driven by higher cash used due to the timing of working capital. Q: Brendan, McCormick had been indicating that EBIT growth would be more weighted towards the second half, but second-quarter EBIT was stronger than expected. What contributed to this outcome? A: Brendan Foley, CEO: Our consumer business performed well, driven by volume across core categories, and we built share. In Flavor Solutions, we navigated tough conditions better than most. Marcos Gabriel, CFO, added that strong operating profit delivery was driven by SG&A efficiencies, including stock-based compensation and CCI program initiatives. Q: Can you elaborate on the tariff mitigation actions and how you balance cost work with strategic pricing? A: Marcos Gabriel, CFO: The majority of mitigation actions are driven by sourcing and CCI. We use data analytics for buying decisions and sourcing locations. Pricing is the residual, and we apply it surgically, using analytics to assess elasticity and maintain volume momentum. Q: Could you provide more detail on the gross tariff exposure of $90 million and the impact of the global trade environment on costs? A: Marcos Gabriel, CFO: Our tariff exposure is related to raw materials not grown in the US. We use a blended tariff rate to estimate a 2% impact on COGS globally. The global trade environment has not driven expected lower costs, impacting our gross margin, which we plan to offset through SG&A initiatives. Q: How are you managing sourcing opportunities without sacrificing quality? A: Brendan Foley, CEO: Quality remains a top priority, and we procure items that meet our high-quality requirements. Marcos Gabriel, CFO, emphasized that there is no trade-off between quality and price, and our sourcing organization ensures both. Q: What is the outlook for the Flavor Solutions segment in the second half of the year? A: Brendan Foley, CEO: In the Americas, we expect trends to sustain, with potential improvement if QSR traffic increases. In EMEA, we anticipate stabilization against weaker prior-year performance. Asia Pacific trends are expected to remain consistent with the first half. Q: How are discussions with retailers regarding innovation and pricing? A: Brendan Foley, CEO: We have positive, productive conversations with retailers, focusing on category growth and consumer needs. Our strong category management, innovation, and brand marketing support drive collaborative and successful retailer relationships. Q: Are you confident in achieving long-term objectives despite tariff impacts? A: Brendan Foley, CEO: Yes, we remain confident in our long-term objectives. While we adjust plans as needed, tariffs have not derailed our long-term strategy. Q: What is the level of innovation activity from large CPG customers, and how does it benefit McCormick? A: Brendan Foley, CEO: We see increased reformulation and innovation activity, particularly in health and wellness categories. This activity is incremental and benefits McCormick through strong win rates and collaboration with customers. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
26-06-2025
- Business
- Yahoo
McCormick (MKC) Stock Trades Up, Here Is Why
Shares of food flavoring company McCormick (NYSE:MKC) jumped 5.6% in the afternoon session after the company reported second-quarter 2025 earnings that beat analyst expectations and reaffirmed its full-year financial outlook. The company posted an adjusted earnings per share of $0.69, surpassing the consensus estimate of $0.65. This positive result was driven by a 10% increase in adjusted operating income, which reached $259 million. Sales saw a modest 1% increase, but importantly, this was led by a 2% rise in organic sales volume, indicating that consumers are buying more of its products. The performance of the Consumer segment was a particular bright spot, with net sales growing by 3%. Management expressed confidence in their strategy, reaffirming their fiscal 2025 guidance for sales and adjusted earnings per share, signaling stability despite what they termed a "dynamic environment." Overall, this was a strong quarter. Is now the time to buy McCormick? Access our full analysis report here, it's free. McCormick's shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today's move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business. McCormick is up 2.2% since the beginning of the year, and at $77.54 per share, it is trading close to its 52-week high of $84.76 from September 2024. Investors who bought $1,000 worth of McCormick's shares 5 years ago would now be looking at an investment worth $879.89. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
