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Campbell Soup (CPB) Gains As Market Dips: What You Should Know

Zacks Equity Research
·3 min read

Campbell Soup (CPB) closed at $49.52 in the latest trading session, marking a +1.77% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.21%. Elsewhere, the Dow lost 0.58%, while the tech-heavy Nasdaq lost 0.46%.

CPB will be looking to display strength as it nears its next earnings release, which is expected to be June 3, 2020. On that day, CPB is projected to report earnings of $0.73 per share, which would represent year-over-year growth of 30.36%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.31 billion, up 6.19% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.83 per share and revenue of $8.68 billion. These totals would mark changes of +23.04% and -7.34%, respectively, from last year.

Investors might also notice recent changes to analyst estimates for CPB. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 1.74% higher within the past month. CPB is currently a Zacks Rank #3 (Hold).

Investors should also note CPB's current valuation metrics, including its Forward P/E ratio of 17.17. This represents a discount compared to its industry's average Forward P/E of 19.78.

Investors should also note that CPB has a PEG ratio of 2.4 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. Food - Miscellaneous stocks are, on average, holding a PEG ratio of 3.38 based on yesterday's closing prices.

The Food - Miscellaneous industry is part of the Consumer Staples sector. This industry currently has a Zacks Industry Rank of 45, which puts it in the top 18% of all 250+ industries.

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

You can find more information on all of these metrics, and much more, on Zacks.com.


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Zacks Investment Research