Jefferies analyst Akshay Jagdale maintained a Hold rating on Pilgrim’s Pride (PPC) today and set a price target of $19. The company’s shares closed on Friday at $20.09.
Jagdale said:
“Although we had significantly lowered our 4Q18 estimates earlier in the week, EBIT missed our below-the-Street estimate by ~28% because of a challenging environment (oversupply) in the US and higher grain costs in Europe. US retail chicken demand has improved over the past month; however, we remain sceptical about its sustainability given the abundance of competing protein supplies. As such, we remain cautious on NT industry fundamentals. 4Q18 EBIT significantly missed our already below-consensus estimates. 4Q18 net sales came in at ~$18M (or 1%) below our estimates but were in line with consensus. Consolidated gross margin of 4.2% was 150bp below our estimate and 170bp below consensus, resulting in gross profit missing our estimate by ~27% and consensus by ~29%. This was partially offset by lower SG&A/sales, which came in 90bp below our estimate and 150bp below consensus.”
According to TipRanks.com, Jagdale is a 3-star analyst with an average return of 1.4% and a 50.0% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and Conagra Brands Inc.
The word on The Street in general, suggests a Hold analyst consensus rating for Pilgrim’s Pride with a $19 average price target.
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Based on Pilgrim’s Pride’s latest earnings release for the quarter ending December 31, the company reported a quarterly GAAP net loss of $7.32 million. In comparison, last year the company had a net profit of $134 million.
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Pilgrim’s Pride Corp. engages in the production, processing, marketing and distribution of fresh, frozen, and value-added chicken products to retailers, distributors and foodservice operators. It operates through the following segments: U.S., U.K. & Europe, and Mexico.
