The J. M. Smucker Company (SJM – Free Report) is likely to witness a top and bottom-line decline when it reports third-quarter fiscal 2025 earnings on Feb. 27. The Zacks Consensus Estimate for revenues is pegged at $2.22 billion, indicating a 0.4% drop from the prior-year quarter’s reported figure.
The consensus mark for earnings has declined by a penny in the past 30 days to $2.35 per share, which suggests a 5.2% decrease from the figure reported in the year-ago quarter. SJM has a trailing four-quarter earnings surprise of 11.5%, on average.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The J. M. Smucker Company Price, Consensus and EPS Surprise
The J. M. Smucker Company price-consensus-eps-surprise-chart | The J. M. Smucker Company Quote
SJM: Key Factors to Watch
The J.M. Smucker is navigating a challenging consumer landscape characterized by inflationary pressures and reduced discretionary spending, which are reshaping purchasing habits. These shifting consumer dynamics are particularly problematic for segments like sweet baked goods, where recovery has been slower than expected. The increasing selectivity in consumer spending has led to diminished activity across various retail channels, including convenience stores, adding strain. Management revised its full-year guidance for the sweet baked goods segment downward on its second-quarter earnings call, citing ongoing challenges from shifting consumer dynamics. This raises concerns for the quarter under review.
The J. M. Smucker remains vulnerable to commodity cost inflation and volatility, particularly in its Coffee and Pet Foods segments. While pricing actions have been implemented to mitigate these pressures, rising costs for raw materials, transportation and production pose risks to profitability.
The J. M. Smucker has been incurring high selling, distribution and administrative (SD&A) costs. The company expects SD&A expenses to increase roughly 9% in fiscal 2025, reflecting higher marketing investments. In the third quarter of fiscal 2025, adjusted EPS is expected to decline in mid-single digits due to elevated SD&A expenses.
However, the resilience of its categories and the effective execution of key growth strategies have been aiding amid a dynamic landscape. The J. M. Smucker’s strategic priorities include focusing on growing volume and net sales, operating with excellence and prioritizing resources to capitalize on the fastest growth opportunities. The company concentrates on integrating and delivering on the acquired Hostess Brands business. SJM’s focus on reshaping its portfolio to achieve sustainable growth across pet food and pet snacks, coffee as well as snacking categories has also been working well.
Earnings Whispers for SJM Stock
Our proven model doesn’t conclusively predict an earnings beat for The J. M. Smucker this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here.
The J. M. Smucker carries a Zacks Rank #3 and has an Earnings ESP of -0.44%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks With the Favorable Combination
Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.
Costco Wholesale (COST – Free Report) currently has an Earnings ESP of +0.14% and a Zacks Rank of 2. The company is likely to register top and bottom-line growth when it reports second-quarter fiscal 2025 numbers. The Zacks Consensus Estimate for Costco’s quarterly revenues is pegged at $63.2 billion, which suggests 8.2% growth from the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Costco’s quarterly earnings per share is pegged at $4.09, indicating a 10.2% increase from the year-ago period. COST has a trailing four-quarter earnings surprise of 2%, on average.
Home Depot (HD – Free Report) currently has an Earnings ESP of +1.29 % and a Zacks Rank of 3. The company is likely to register top and bottom-line growth when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for Home Depot’s quarterly revenues is pegged at $39.14 billion, which suggests an increase of 12.5% from the prior-year quarter.
The Zacks Consensus Estimate for Home Depot’s quarterly earnings per share is pegged at $3.04, indicating 7.8% growth from the year-ago period. HD has a trailing four-quarter earnings surprise of 2.3%, on average.
Grocery Outlet Holding (GO – Free Report) currently has an Earnings ESP of +1.32% and a Zacks Rank of 3. The company is likely to register a decrease in the bottom line when it reports fourth-quarter 2024 numbers. The Zacks Consensus Estimate for the quarterly earnings per share is pegged at 17 cents, down 5.6% from the year-ago period. GO has a trailing four-quarter negative earnings surprise of 2.2%, on average.
Grocery Outlet’s top line is expected to rise year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $1.09 billion, which suggests an increase of 9.7% from the prior-year quarter.
Financial Market Newsflash
No financial news published today. Check back later.
