What to expect when J.M. Smucker (SJM) reports Q1 2024 earnings

Shares of The J.M. Smucker Co. (NYSE: SJM) stayed red on Tuesday. The stock has dropped 11% year-to-date. The food company is scheduled to report its earnings results for the first quarter of 2024 on Tuesday, August 29, before market open. Here’s a look at what to expect from the earnings report:

Revenue

Analysts are projecting revenue of $1.84 billion for the first quarter of 2024, which would represent a decline of nearly 2% from the same period a year ago. In the fourth quarter of 2023, net sales increased 10% year-over-year to $2.2 billion.

Earnings

The consensus estimate for EPS in Q1 2024 is $2.04 which compares to EPS of $1.67 reported in the year-ago period. In Q4 2023, adjusted EPS increased 18% YoY to $2.64.

Points to note

J.M. Smucker expects comparable net sales and adjusted EPS to increase approx. 20% in the first quarter versus the year-ago period, mainly due to lapping the impact of the Jif peanut butter recall and continued business momentum.  

Comparable sales in the fourth quarter of 2023 increased 11%, benefiting from net price realization across all its segments. Volume/mix remained neutral compared to the year-ago period. These trends are likely to have continued into the first quarter.

The company is likely to see momentum in its Pet Foods business driven mainly by gains in its dog snacks category. Its Coffee segment is likely to see growth driven by the at-home coffee portfolio. The Consumer Foods business is expected to benefit from gains in Uncrustables frozen sandwiches, Smucker’s fruit spreads, and Jif peanut butter.

SJM revamped its portfolio and divested some of its pet food brands, exiting the dog food category. This will allow it to focus on the higher margin dog snacks and cat food categories. These efforts are expected to drive continued improvements in product mix and profit margins.