Why Conagra Brands Popped 19% Higher Thursday Morning
Shares of Conagra Brands (NYSE: CAG), a leading packaged food company that owns a catalog of well-known names such as Duncan Hines, Orville Redenbacher's, and Healthy Choice, soared 19% Thursday morning after it released strong fiscal second-quarter 2020 results that topped both top- and bottom-line estimates.
For the period, which ended Nov. 24, net sales jumped 18.3% to $2.82 billion, just topping analysts' forecast for $2.80 billion. Adjusted earnings per share checked in at $0.63, easily topping analysts' consensus estimate of $0.57.
While the surge in Conagra's top-line appears impressive, it's important to break it down for better understanding. There was a 19.6% increase in net sales from the acquisition of Pinnacle, a 2.9% decrease due to its divestiture of a number of businesses, and a 1.6% increase in organic net sales. The organic sales increase, likely the most important metric for investors, was driven by 1% volume growth and a favorable 0.6% increase in price/mix.
Source Fool.com
