Yahoo Finance Pilgrim's Pride (PPC) Up More Than 40% in 6 Months: Here's How
Pilgrim's Pride Corporation PPC has been experiencing benefits from its strategic initiatives like focus on key customers, capacity expansion, brand fortification and reducing costs. The company has been witnessing market strength through its emphasis on value-added offerings and operational excellence.
These upsides have been working well for this Zacks Rank #3 (Hold) stock, which has jumped 44.2% in the past six months, outpacing the industry’s growth of 19.7%.
Notably, Pilgrim’s Pride experienced robust growth in its Mexico, U.S. and Europe segments, and in the foodservice category during the first quarter of 2024. Success across different regions and channels underscores the effectiveness of the company’s business strategies and market approach.
The Zacks Consensus Estimate for PCC’s current financial-year earnings has risen by 22.6% in the past 30 days to $3.64 per share, which suggests whopping 115.4% growth from the year-ago reported number.
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Let’s Dig Deeper
Pilgrim’s Pride has been benefiting from strength of its Mexico operations for a while now. In first-quarter 2024, the Mexico business showed a significant improvement from the previous year, driven by balanced supply and demand fundamentals in commodity markets, favorable exchange rates and sustained implementation of strategies. Its operations in Mexico achieved enhanced outcomes despite challenging market dynamics, benefiting from strong diversified brand offerings and an expanded engagement with key customers. The company has strengthened its business in Mexico by collaborating with its key customers which grew 13% during the quarter.
Moving to the Europe business, it continued to perform well in the quarter. Management is focused on enhancing labor efficiency, optimizing the mix and improving yields in the Europe region, which are all critical for productivity and growth. The segment flaunts a diversified food portfolio, including fresh pork, bacon, sausage, gammon and chicken. PPC witnessed an increase in demand for chicken, bacon, sausage and gammon in this segment during the quarter.
Furthermore, Pilgrim's Pride continued to witness positive momentum in its food service distribution channel. Both commercial and non-commercial subchannels reported higher volume and sales in the first quarter. This uptick was driven by the passing on of higher wholesale prices to operators, with the quick-service restaurant segment playing a pivotal role in driving volume growth.
Is Everything Rosy for PPC?
Pilgrim’s Pride has been experiencing the challenges of enduring inflation and the ever-changing nature of market conditions. The company has been grappling with increased cost of sales for a while. In the first quarter of 2024, although its overall cost of sales declined slightly to $3,978.0 million, the metric increased in Europe and Mexico. The metric increased about $20.7 million and $16.9 million to $1,175.8 million and $460.3 million in Europe and Mexico, respectively. Persistence of these trends may impact margins.
Nonetheless, the abovementioned upsides, along with the company’s commitment to supply-chain enhancements is likely to help it continue thriving in the market.
3 Picks You Can’t Miss
Here, we have highlighted three better-ranked stocks, namely, Tyson Foods TSN, Hormel Foods HRL and Colgate-Palmolive Company CL.
Tyson Foods, which operates through the Beef, Pork, Chicken and Prepared Foods segments, currently carries a Zacks Rank #2 (Buy). TSN delivered an average earnings surprise of 24.2% in the trailing four quarters, on average. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Tyson Foods’ current fiscal-year earnings calls for growth of 85.1% from the year-ago reported numbers.
Hormel Foods develops, processes and distributes various meat, nuts and other food products. It currently carries a Zacks Rank #2. HRL has a trailing four-quarter earnings surprise of 3.5%, on average.
The Zacks Consensus Estimate for Hormel Foods’ current financial-year sales suggests growth of 1.2% from the prior-year levels.
Colgate-Palmolive Company, a general manufacturer and retailer of consumer products, currently carries a Zacks Rank #2. CL has a trailing four-quarter earnings surprise of 4.6%, on average.
The Zacks Consensus Estimate for CL’s current fiscal-year earnings and sales suggests growth of 9% and 3.9% from the year-earlier actuals.
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Colgate-Palmolive Company (CL) : Free Stock Analysis Report
Hormel Foods Corporation (HRL) : Free Stock Analysis Report
Tyson Foods, Inc. (TSN) : Free Stock Analysis Report
Pilgrim's Pride Corporation (PPC) : Free Stock Analysis Report
