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Grocery Or Consumer Staples Update 121614 http://seekingalpha.com/p/24cql Dec 17, 2014

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Grocery (Or Consumer Staple) Update 82214 2 comments
Grocery Portfolio 082214
The Q214 dividend is used for yield calculations. The second Div/EPS ratio has the 2015 EPS projection as the denominator. "Div 1 yr" measures the change in the dividend since Q213. "Div 5 yr" measures the average change in the dividend since Q209. FLO announced a dividend increase for Q214, which was only 3 quarters after the last increase. The last increase was only 6.67%. FLO's last three dividend increases have been well below trend.
Year to date news on under performing stocks:
SJM's Jiff has long term contracts for supply, and is not benefiting from the price fall in peanuts. HRL's Skippy does not have long term contracts  and it is benefiting from the price fall in peanuts. In its mid February conference call, Smucker's cut its fullyear adjusted earnings forecast to $5.55$5.60 per share from $5.72$5.82. On 605 SJM provided 2015 nonGAAP EPS guidance in the range of $5.95 to $6.05  which was in line with the existing projections.
CAG's consumer segment posted a sales decrease of 3.5% to $1.87 billion on a 3% decline in volume. Some key brands like Healthy Choice, Orville Redenbacher's and Chef Boyardee continue to post "substantial" declines in volume. CAG lowered its EPS projection in February  and did so again on June 18th. CAG's results have been buoyed somewhat by the company's $4.95 billion acquisition of privatelabel food maker Ralcorp last year.
FLO provided guidance for 2014 of earnings per share of $0.98 to $1.05 compared to the existing analyst consensus projection of $1.05. Share price appreciation was 39.87% in 2013 compared to a sector average of 24.52%  and FLO ended 2013 with a 23.59 P/E compared to the coverage universe average of 19.87. FLO's normal premium has been just over 300 bps. It's my best guess that the 2014 under performance of FLO has more to do with mean revision that it has to do with any negative operating news.
CLX cuts its EPS forecast to $4.25$4.35. CLX updated their fiscal year outlook to reflect a negative fullyear impact of about 15 cents from the recent Venezuela currency devaluation. Dividend dates are:
Historical yields for the sector:
The Importance of Rising Dividends year to date The following companies had dividend growth of more than 9% between Q213 and Q214: ADM , INGR , CLX , FLO , GIS , HSY , HRL , LANC , PEP , SJM . Their mean price gain for the year is 3.18%. Their mean total return for the year is 4.67%  and 5 of the 10 beat the sector median yearly price gain.
The following companies had dividend increases of less than or equal to 9% : CPB , KO , CAG , CL , K , KMB , MKC , PG . Their mean price gain for the year is 0.85%. Their mean total return for the year is 2.69%  and 3 of the 8 beat the sector median yearly price gain.
The Importance of the Dividends/EPS year to date The following companies have dividend/EPS ratios under 44%: ADM , INGR , HRL , SJM . Their mean price gain for the year is 8.93%. Their mean total return for the year is 10.27%  and 3 of the 4 beat the sector median yearly price gain.
The following companies have dividend/EPS ratios over 44% but under 52%: CPB , CAG , CL , FLO , HSY , K , LANC , MKC , PEP . Their mean price gain for the year is 0.55%. Their mean total return for the year is 0.91%  and 2 of the 9 beat the sector median yearly price gain.
The following companies had dividend/EPS ratios over 52% : KO , CLX , GIS , KMB , PG . Their mean price gain for the year is 1.58%. Their mean total return for the year is 3.78%  and 3 of the 5 beat the sector median yearly price gain.
The Importance of EPS Revisions year to date The following companies had growing EPS estimates since the beginning of 2014: CPB . Their mean price gain for the year is 1.69%. Their mean total return for the year is 3.85%  and 0 of the 1 beat the sector median yearly price gain.
The following companies had decreases  but decreases of less than 5%  to the EPS estimates: CL , INGR , CLX , GIS , HSY , HRL , K , KMB , LANC , MKC , PEP , PG , SJM . Their mean price gain for the year is 3.1%. Their mean total return for the year is 4.81%  and 7 of the 13 beat the sector median yearly price gain.
The following companies had decreases to the EPS estimates of more than 5% since the beginning of 2014: ADM , KO , CAG , FLO . Their mean price gain for the year is 0.85%. Their mean total return for the year is 0.45%  and 1 of the 4 beat the sector median yearly price gain.
The Importance of Rising Price Targets year to date This cynic believes that 'people have to be told to buy stocks  and which ones to buy'. One way this is done is via the changes in their price targets.
The following companies had rising price targets since the beginning of the year : ADM , CPB , KO , CL , INGR , FLO , GIS , HRL , KMB , LANC , MKC , PEP , PG . Their mean price gain for the year is 3.86%. Their mean total return for the year is 5.56%  and 7 of the 13 beat the sector median yearly price gain.
The following companies had flat or falling price targets : CAG , CLX , HSY , K , SJM . Their mean price gain for the year is 2.32%. Their mean total return for the year is 0.84%  and 1 of the 5 beat the sector median yearly price gain.
Price/Earnings Ratios 0822
CAG, GIS, PG and SJM are already in fiscal 2015
Yield + CAGR Total Return Expectations
Disclosure: The author is long CL, CLX, HRL, GIS, PEP, PG, SJM.
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