Food and beverage manufacturer Campbell Soup Company (NYSE: CPB) The stock is attempting a breakout stage after bouncing off the $ 40.00 support level. The epidemic may have wiped out groceries, but demand for groceries has continued to grow in the face of inflationary pressures and supply chain disruptions. Logistic pressures arising from rising freight costs have been passed on to customers with higher prices which has improved margins for producers and distributors. The company said second-quarter financial performance is expected to improve as its recent pricing activity, supply chain and improved labor conditions should be fully reflected in the market. Russia-Ukraine conflict may have an indirect effect on product prices. The goal is to create momentum in the second half of the year. The prudent investors who want to get discount exposure in this iconic food player can see the opportunistic pullback in the shares of Campbell Coupe.
Q2 Financial 2022 Earnings Release
On March 9, 2022, Campbell released its financial second-quarter 2022 results for the quarter ending January 2021. The company reported earnings per share (EPS) of $ 0.69, a $ 0.068 EPS beat, excluding estimates for non-recurring item vs. consensus analyst profit. Revenue decreased (-3.1%) over the year (YoY) $ 2.21 billion Missing analysts estimate জন্য 2.25 billion for the quarter. Mark Klaus, CEO of Campbell Soup, commented, “As expected, our second quarter was challenging because we overcame a difficult comparison and navigated labor and supply constraints, which were made more difficult by the growth of Omicron. However, in the second half of We are seeing improvement in levels, better mitigation of inflation with prices and stronger levels of demand based on our confidence in providing year-round guidance. “
Campbell has reaffirmed the financial full-year EPS for 2022 from $ 2.75 to $ 2.85 vs. $ 2.78 consensus analyst estimates. The company expects revenue from $ 8.31 billion to $ 8.47 billion versus $ 8.42 billion consensus analyst estimates.
Conference Call Takeaways
CEO Klaus explained how the quarter was expected to be challenging due to industry-wide labor constraints and the availability of materials due to Omicron growth. He expects inflation to continue, especially in the area of logistics. Russia’s dispute with Ukraine does not directly affect them, but it does affect the price of goods. Organic net sales declined (-2%) due to labor and supply shortages, while consumption increased 9% on a two-year basis. The main driver of the supporting supply pressure. CEO Klaus expects the company to restore distribution in the second half of the year to fully support its portfolio. As for the original soup business, he said, “We performed very well and the second quarter brought in additional millennials and General Z buyers for our concentrated food and cooking diversity. In total U.S. soup, quarterly family inflows increased compared to both the previous year and two years ago. And importantly, we’re seeing more consumers participate in the soup segment and purchase our soup brands than at the pre-epidemic level. Although our pricing activity has increased the cost per dollar per buyer, the volume per buyer has been relatively stable at the pre-epidemic level, despite the limited supply in the quarter. ” Its soup and broth lines have posted the second biggest holiday in five years. The Chunky brand has experienced 25% usage growth and 2 point market share growth over the last two years. This is the story of a second half of price increases with supply chain improvements, distribution costs and cost reduction initiatives.
CPB opportunistic pullback level
Using rifle charts in weekly and daily time frames provides an accurate view of the landscape for CPB stocks. Weekly Rifle Chart is around $ 40.00 Fibonacci (Five) layer. The weekly rifle chart contains clusters of moving averages (MAs) assembled in a make or break set-up. Weekly 5-period MA sits at $ 43.95, 15-period MA sits at $ 44.29, 50-period MA sits at $ 44.17, and 200-period MA sits at $ 44.15. The weekly stochastic is going down to the 50-band. Weekly Lower Market Structure (MSL) Buy at Breakout through $ 41.67. Weekly lower Bollinger Bands (BBs) sit at $ 39.40, and weekly upper BBs sit at $ 47.98. The uptrend of the daily rifle chart is in the rising 5-period MA $ 44.52 as it has increased from the daily 50-period MA to .9 43.95 in the rising 15-period MA to .5 43.54 and the 200-period MA to $ 43.19. Daily upper BBs sit at $ 46.11 and lower BBs at $ 40.11. Wise investors can scale Opportunistic pullback levels at $ 44.19 fib, $ 43.45 fib, $ 42.62 fib, MS 41.67 weekly MSL trigger, and $ 40.00 fib level. Upside trajectories range from $ 49.26 fib level to $ 54.76 fib level.