Smucker (SJM) Expected to Beat Earnings Estimates: Should You Buy?

Core Viewpoint - Smucker (SJM) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ending July 2024, with actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is scheduled for August 28, 2024, with expectations that better-than-expected results could drive the stock price higher, while disappointing results may lead to a decline [2]. - The consensus estimate for quarterly earnings is $2.18 per share, reflecting a year-over-year decrease of 1.4%, while revenues are projected to be $2.13 billion, an increase of 18.2% from the previous year [3]. Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised down by 0.78%, indicating a reassessment by analysts regarding the company's earnings outlook [4]. - The Zacks Earnings ESP (Expected Surprise Prediction) model suggests that recent estimate revisions provide insights into the business conditions leading up to the earnings release [5][6]. Earnings Surprise Potential - For Smucker, the Most Accurate Estimate exceeds the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +1.89%, indicating a likelihood of beating the consensus EPS estimate [10]. - The company has a Zacks Rank of 3, which, when combined with the positive Earnings ESP, suggests a favorable outlook for an earnings beat [10]. Historical Performance - Smucker has consistently outperformed consensus EPS estimates, achieving earnings surprises in the last four quarters, including a notable surprise of +14.66% in the most recent quarter [11][12]. Conclusion - While Smucker is positioned as a strong candidate for an earnings beat, it is essential to consider other factors that may influence stock performance beyond just the earnings results [13][15].