Specialty food maker Marzetti's Q2 sales just shy of estimates as retail unit weighs

Overview

• Specialty food maker's fiscal Q2 sales slightly missed analyst expectations

• Adjusted EPS for fiscal Q2 improved yr/yr

• Company entered agreement to acquire Bachan's, Inc.

Outlook

• Marzetti projects retail sales growth from licensing programs and brand investments

• Company anticipates foodservice growth from national chain restaurant accounts

Result Drivers

• RETAIL SALES DECLINE - Retail segment sales fell 1.1% due to softer demand and a 3.1% decrease in sales volume, partially offset by inflationary pricing

• FOODSERVICE GROWTH - Foodservice segment sales grew 5.2% due to higher demand from national chain restaurant accounts and inflationary pricing

• COST SAVINGS - Ongoing cost savings initiatives improved gross profit and margin

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 2 "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the food processing peer group is "buy."

• Wall Street's median 12-month price target for Marzetti Co is $190.00, about 9.3% above its February 2 closing price of $173.91

• The stock recently traded at 24 times the next 12-month earnings vs. a P/E of 22 three months ago

Press Release: ID:nBwcdvy7La

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