General Mills (GIS) Stock Sinks As Market Gains: What You Should Know

General Mills (GIS) Stock Sinks As Market Gains: What You Should Know

In the latest trading session, General Mills (GIS Quick QuoteGIS – Free Report) closed at $65.10, marking a -0.18% move from the previous day. The stock’s change was less than the S&P 500’s daily gain of 0.28%. Elsewhere, the Dow saw an upswing of 0.17%, while the tech-heavy Nasdaq appreciated by 0.9%.

Prior to today’s trading, shares of the maker of Cheerios cereal, Yoplait yogurt and other packaged foods had gained 1.97% over the past month. This has lagged the Consumer Staples sector’s gain of 3.73% and outpaced the S&P 500’s gain of 1.45% in that time.

The investment community will be paying close attention to the earnings performance of General Mills in its upcoming release. The company’s earnings per share (EPS) are projected to be $1.16, reflecting a 5.45% increase from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.39 billion, up 3.2% from the year-ago period.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $4.48 per share and revenue of $20.64 billion. These totals would mark changes of +4.19% and +2.71%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for General Mills. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company’s business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.09% lower within the past month. Currently, General Mills is carrying a Zacks Rank of #3 (Hold).

In terms of valuation, General Mills is currently trading at a Forward P/E ratio of 14.56. This denotes a discount relative to the industry’s average Forward P/E of 15.82.

Investors should also note that GIS has a PEG ratio of 2.19 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. As of the close of trade yesterday, the Food – Miscellaneous industry held an average PEG ratio of 2.31.

The Food – Miscellaneous industry is part of the Consumer Staples sector. At present, this industry carries a Zacks Industry Rank of 96, placing it within the top 39% of over 250 industries.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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