Campbell Soup tops analysts’ estimates for earnings and revenue in the third quarter

Campbell Soup (NYSE: CPB) released its third-quarter earnings report on Wednesday that topped analysts’ estimates for earnings and revenue as consumers stockpiled pasta sauces, soup, and salsa ahead of the Coronavirus restrictions. The company also upgraded its forecast for full-year sales and profit on Wednesday.

Shares of the company were reported 2% up in premarket trading on Wednesday. At £38.87 per share, Campbell Soup is roughly 5% up year to date in the stock market. At the time of writing, the food company has a market capitalisation of £11.71 billion and a price to earnings ratio of 10.23.

Campbell’s full-year guidance for fiscal 2020

According to Campbell, packaged foods were greatly in demand in recent months as the Coronavirus pandemic restricted people to their homes and fuelled a trend of cooking at home. The U.S. company also recorded a 6% growth in households that purchased its products in the recent quarter. With increased marketing, Campbell is now committed to turning the new households into regular customers. Campbell recently reported confirmed cases of COVID-19 at its factory.

For the full financial year, the Camden-headquartered company now forecasts £2.28 to £2.32 of adjusted earnings per share. Previously, the company had estimated £2.03 to £2.07 of adjusted EPS in the current fiscal year.

In terms of net sales, the maker of Goldfish crackers and Prego pasta said it now anticipates a 5.5% to 6.5% growth in fiscal 2020. Originally, it had estimated its full-year net sales to lie in the range of a 1% decline and a 1% increase.

Campbell’s Q3 financial results versus analysts’ estimates

At £1.78 billion, Campbell’s net sales recorded a 15% growth in Q3 that topped the analysts’ forecast of £1.76 billion. The company attributes upbeat sales to a higher demand for V8 drinks, Prego pasta sauces, and Pepperidge Farm cookies.

Excluding non-recurring items, Campbell made 66 pence of earnings per share in the third quarter that were also reported stronger than 59.6 pence of EPS that experts had estimated, as per Refinitiv.

The American processed food and snack company generated 35% higher sales from its namesake soup segment. Its market share in the recent quarter, however, was hurt due to COVID-19 related complications. The company commented on its earnings report on Wednesday and remarked:

“Like everyone, we were and are operating in conditions unlike any we have ever experienced and we didn’t get everything perfect in regard to product availability.”

Campbell Soup recorded an about 50% increase in the stock market last year.