General Mills has been seeing weakness in its Europe &
Australia and Asia & Latin America segments and this might continue in the
second quarter as well. The North American Retail segment might see benefits
from net price realization and mix. The company’s cost reduction efforts are also
likely to benefit the bottom line numbers.
In the first quarter of 2020, General Mills beat earnings estimates while revenues matched expectations. Net sales fell by 2% to $4 billion while adjusted EPS rose 13% to $0.79.
Also read: General Mills Q1 2020 Earnings Conference Call Transcript
For fiscal 2020, the company expects organic net sales growth of 1% to 2%. Reported net sales are anticipated to rise by about 1% backed by a combination of currency translation, the impact of divestitures executed in fiscal 2019, and contributions from the 53rd week. Adjusted earnings are predicted to increase by 3% to 5% from the base of $3.22 earned in 2019.
Shares of General Mills have gained 33% so far this year. The majority of analysts have rated the stock as Hold and the average price target is $55.86.