Let's dig into the relative performance of Simply Good Foods (NASDAQ:SMPL) and its peers as we unravel the now-completed Q2 consumer staples earnings season.
The consumer staples industry comprises companies engaged in the manufacturing, distribution, and sale of essential, everyday products. These products, also known as "staples," are fundamental to daily living and include packaged food, beverages and alcohol, personal care, and household products. Consumer staples stocks are considered defensive investments because consumers often purchase them regardless of economic conditions. To stand out, companies must have some combination of brand recognition, product quality, and price competitiveness.
The 4 consumer staples stocks we track reported an ok Q2; on average, revenues missed analyst consensus estimates by 0.9%. Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 due to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and while some of the consumer staples stocks have fared somewhat better than others, they collectively declined, with share prices falling 0.4% on average since the previous earnings results.
Simply Good Foods (NASDAQ:SMPL) Best known for its Atkins brand that was inspired by the popular diet of the same name, Simply Good Foods (NASDAQ:SMPL) is a packaged food company whose offerings help customers achieve their healthy eating or weight loss goals.
Simply Good Foods reported revenues of $334.8 million, up 3.1% year on year, falling short of analysts' expectations by 0.9%. It was an ok quarter for the company, with a decent beat of analysts' gross margin estimates.
“Simply Good Foods third quarter results were led by continued Quest growth, improving Atkins marketplace trends as well as strong gross margin performance,” said Geoff Tanner, President, and Chief Executive Officer of Simply Good Foods.
The stock is down 0.8% since the results and currently trades at $35.87.
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Best Q2: McCormick (NYSE:MKC) The classic red Heinz ketchup bottle’s competitor, McCormick (NYSE:MKC) sells food-flavoring products like condiments, spices, and seasoning mixes.
McCormick reported revenues of $1.64 billion, down 1% year on year, in line with analysts' expectations. It was a solid quarter for the company, with a decent beat of analysts' organic revenue growth and earnings estimates.
McCormick pulled off the biggest analyst estimates beat among its peers. The stock is up 3.3% since the results and currently trades at $69.87.
Weakest Q2: General Mills (NYSE: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 $4.71 billion, down 6.3% year on year, falling short of analysts' expectations by 3%. It was a weaker quarter for the company, with a miss of analysts' organic revenue growth estimates.
General Mills had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 6.2% since the results and currently trades at $63.08.
Constellation Brands (NYSE:NYSE:STZ) With a presence in more than 100 countries, Constellation Brands (NYSE:STZ) is a globally renowned producer and marketer of beer, wine, and spirits.
Constellation Brands reported revenues of $2.66 billion, up 5.8% year on year, falling short of analysts' expectations by 0.4%. It was a solid quarter for the company, with optimistic earnings guidance for the full year and a decent beat of analysts' gross margin estimates.
Constellation Brands delivered the fastest revenue growth among its peers. The stock is down 3.2% since the results and currently trades at $250.37.
This content was originally published on Stock Story
