CPB - Embedded Expectations Analysis - 2020 05 08
Campbell Soup Company (CPB:USA) currently trades near historical averages relative to UAFRS-based (Uniform) earnings, with a 19.6x Uniform P/E. Even at these levels, the market has bullish expectations for the firm, but management may be concerned about sales growth, cost savings initiatives, and product headwindsSpecifically, management may lack confidence in their ability to deliver sustainable business growth, maintain their in-market performance momentum, and sustain adjusted EPS and snack segment growth. In addition, they may have concerns about flat net sales growth, forecasted net sales declines, and ongoing breakfast and healthy grain product headwinds. Moreover, they may be exaggerating their ability to mitigate the impact of distribution losses in their ready-to-serve business, position Meals and Beverage as a growth-oriented business, and innovate product packaging. Furthermore, they may lack confidence in their ability to execute their cost savings initiatives, realize Snyder's-Lance integration synergies, and improve gross margins through pricing action
Campbell Soup is a manufacturer and marketer of food and beverage products. The company's reportable segments are: Meals and Beverages, which includes the retail and foodservice businesses in the United States and Canada, and the meals and shelf-stable beverages business in Latin America; Snacks, which consists of Pepperidge Farm cookies, crackers, fresh bakery and frozen products in United States retail, including Milano cookies and Goldfish crackers, and Snyder's of Hanover pretzels, Lance sandwich crackers, Cape Cod and Kettle Brand potato chips, Late July snacks, Snack Factory Pretzel Crisps, Pop Secret popcorn, Emerald nuts, and other snacking products in the United States and Canada.
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