Sprouts Farmers Market, Inc. ( SFM ) is a relatively small U.S. grocery chain that focuses on natural, organic and health-oriented products sold at fair prices. Even though it operates only a bit over 440 storesI’m a former buy-side analyst with a generalist background, covering sectors ranging from technology and utilities to retail. I hold a Master of Science in Finance, with a specialization in valuation, and I’m currently on the path to becoming a CFA charterholder. Finance and valuation have long fasci ...

Core Insights - Sprouts Farmers Market, Inc. (SFM) is a small U.S. grocery chain focusing on natural, organic, and health-oriented products at fair prices [1] Company Overview - SFM operates over 440 stores across the United States [1] - The company emphasizes long-term value investing principles while adapting to dynamic market realities [1] Analyst Position - The analyst holds a beneficial long position in SFM shares through stock ownership, options, or other derivatives [2]

Key Takeaways McCormick raised its quarterly dividend by 3 cents to 48 cents per share.The next dividend will be paid Jan. 12, 2026, to shareholders of record on Dec. 29, 2025.MKC marks 102 years of dividend payments and 40 consecutive years of quarterly hikes.McCormick & Company, Incorporated ((MKC) has raised the quarterly dividend by 3 cents or 6.7% to 48 cents per share. The next dividend payment is scheduled for Jan. 12, 2026, for its shareholders on record as of Dec. 29, 2025.This highlights the compa ...

Core Insights - Energizer Holdings, Inc. reported fourth-quarter fiscal 2025 results with net sales exceeding estimates while earnings fell short, indicating a mixed performance [1][10] - The company is entering a transition period in fiscal 2026, facing temporary tariff costs and has extended Project Momentum to protect margins [2] Financial Performance - Adjusted earnings per share were $1.05, missing the Zacks Consensus Estimate of $1.12, and decreased by 13.9% year over year [3] - Net sales reached $832.8 million, surpassing the Zacks Consensus Estimate of $831 million, marking a 3.4% increase from the previous year [4] - Organic net sales declined by 2.2%, primarily due to a 2.9% decrease in volumes from softer consumer demand in North America [5][10] Segment Performance - Batteries & Lights segment net sales increased by 3.9% to $677.2 million, while segment profit decreased by 15.4% to $151.8 million [6] - Auto Care segment net sales rose by 1% to $155.6 million, with segment profit increasing by 29% to $25.8 million [6] Margin and Cost Analysis - Adjusted gross profit was $320.3 million, down 5.7% year over year, with adjusted gross margin contracting by 370 basis points to 38.5% [7] - Adjusted SG&A expenses increased by 4.2% year over year to $128.2 million, driven by higher costs in the APS business and digital transformation investments [9] Future Outlook - For fiscal 2026, the company expects organic net sales to be flat to slightly higher, with modest gross margin pressure anticipated [17] - Adjusted earnings per share are projected to range from $3.30 to $3.60, while adjusted EBITDA is expected between $580 million and $610 million [18] - The first quarter of fiscal 2026 is expected to reflect a high single-digit percentage decline in organic net sales, with adjusted EPS anticipated in the range of 20 to 30 cents [19]

Core Insights - TreeHouse Foods, Inc. reported third-quarter 2025 results with both net sales and earnings missing the Zacks Consensus Estimate, leading to a withdrawal of all financial guidance following a definitive agreement for acquisition by Investindustrial for $2.9 billion [1][9] Financial Performance - Adjusted earnings were 43 cents per share, missing the consensus estimate of 53 cents and down from 74 cents per share in the same quarter last year [2][9] - Net sales reached $840.3 million, a slight increase of 0.1% year over year, driven by pricing actions and the acquisition of a private-brand tea business, but adjusted net sales decreased by 1.5% from the prior year, missing the consensus estimate of $852 million [3][9] Volume and Pricing Dynamics - Volume and mix had a negative impact of 8.6%, while pricing actions contributed positively by 6.5%. The exit from the ready-to-drink business resulted in a 0.7% decline, and unfavorable foreign currency effects reduced net sales by 0.1% [4] Margin and Cost Analysis - Gross profit margin improved by 3.2 percentage points to 18.8%, aided by $17.5 million in insurance recoveries from product recalls and cost-saving initiatives, although this was partially offset by unfavorable fixed-cost absorption [5] - Total operating expenses surged to $412 million, primarily due to a non-cash goodwill impairment loss of $289.7 million and increased costs related to the Harris Tea acquisition [6] EBITDA and Cash Flow - Adjusted EBITDA decreased to $91.6 million from $102.5 million in the same period last year, impacted by unfavorable volume and mix trends, though partially offset by supply-chain savings and contributions from the Harris Tea acquisition [7] - The company ended the quarter with cash and cash equivalents of $21 million, long-term debt of $1,486.1 million, and total shareholders' equity of $1,262.5 million, with net cash used in operating activities amounting to $62.5 million for the nine months ended September 30, 2025 [8]

Core Insights - McCormick & Company Inc. is focusing on the Comprehensive Continuous Improvement (CCI) program to drive earnings per share (EPS) growth in fiscal 2025, emphasizing sourcing improvements, supply chain productivity, and operational efficiency [1][5] Financial Performance - The company reported a 2% increase in adjusted operating income in the third quarter, primarily due to reduced selling, general, and administrative (SG&A) costs from CCI initiatives, although this was partially offset by increased brand marketing and technology spending [3][9] - Gross margin decreased by 120 basis points year-over-year, attributed to high commodity costs and tariff issues, but management anticipates recovery in the fourth quarter through additional mitigation measures [4][9] Future Projections - For fiscal 2025, McCormick projects adjusted EPS growth of 4% to 6% on a constant-currency basis, driven by volume gains and ongoing cost-saving initiatives [5][9] - The consensus estimate for fiscal 2025 earnings indicates a year-over-year increase of 2.4%, while the estimate for fiscal 2026 suggests a rise of 6.9% [15] Market Position - McCormick's shares have declined by 14.7% year-to-date, slightly worse than the industry decline of 14.4% [6] - The company trades at a forward price-to-earnings ratio of 20.23X, which is higher than the industry average of 14.56X [7]

Core Insights - Flowers Foods, Inc. (FLO) reported third-quarter fiscal 2025 results with modest sales growth but missed the Zacks Consensus Estimate for revenue, while adjusted earnings per share (EPS) declined year over year but met consensus expectations [1][3][11]. Financial Performance - Sales reached $1,226.6 million, a 3% increase year over year, but fell short of the Zacks Consensus Estimate of $1,233 million [4][11]. - Adjusted EPS was 23 cents, reflecting a 30.3% decline year over year [3]. - The Simple Mills acquisition contributed 5.9% to sales, helping to offset declines in price/mix and volume [4][11]. Sales Breakdown - Branded retail sales increased by 6.9% to $812.8 million, driven by the Simple Mills acquisition, despite unfavorable price/mix and lower volumes [5]. - Other sales decreased by 3.8% to $413.8 million, impacted by unfavorable price/mix, although volume for non-retail items increased [6]. Cost and Margin Analysis - Production costs increased to 52.1% of net sales, up 190 basis points, due to higher outside product purchases and lower production volumes [7]. - Selling, distribution, and administrative (SD&A) expenses were 38.8% of sales, reflecting a slight increase due to higher workforce-related costs [8]. - Adjusted EBITDA decreased by 11.4% to $118.1 million, with an adjusted EBITDA margin of 9.6%, down 160 basis points [9]. Cash Flow and Financial Position - Cash flow from operating activities totaled $54.3 million, with capital expenditures of $23.9 million and dividends paid amounting to $52.3 million [12]. - At the end of the fiscal third quarter, cash and cash equivalents were nearly $16.7 million, with long-term debt at $1,779.6 million and stockholders' equity at $1,420.5 million [10]. Fiscal 2025 Outlook - Management revised the fiscal 2025 net sales outlook to a range of $5.254-$5.306 billion, indicating a year-over-year increase of 2.9% to 4% [13]. - Adjusted EBITDA is projected to be between $515-$532 million, while adjusted EPS is expected in the range of $1.02-$1.08 [14].

Core Insights - Service Corporation International (SCI) reported strong third-quarter 2025 results, with year-over-year increases in both revenue and earnings, surpassing the Zacks Consensus Estimate [1][2][3] - The company reaffirmed its 2025 earnings outlook and raised its cash flow guidance, indicating improved operational performance and financial discipline [1][15][16] Financial Performance - Adjusted earnings per share (EPS) reached $0.87, exceeding the Zacks Consensus Estimate of $0.83, and reflecting a 10.1% increase from $0.79 in the same quarter last year [2][8] - Total revenues amounted to $1,058.1 million, a 4.4% increase from $1,014 million in the prior year, also beating the consensus estimate of $1,041 million [3][8] - Gross profit rose 5.1% to $265.5 million, with a gross margin expansion of 30 basis points to 25.1% [3][4] Cost Management - Corporate general and administrative expenses decreased by 12.4% year over year to $38.3 million, representing 3.6% of total revenues, down 70 basis points [4][8] - Operating income increased by 6.6% to $226.4 million, with an operating margin improvement of 40 basis points to 21.4% [4][8] Segment Performance - Funeral Operations generated total revenues of $574.1 million, slightly above the consensus estimate, but gross profit declined 7.7% to $99.6 million [5][8] - Cemetery Operations reported total revenues of $484 million, surpassing the consensus estimate, with gross profit increasing 14.6% to $165.9 million [9][10] Guidance and Cash Flow - The company confirmed the mid-point of its 2025 EPS guidance at $3.85, narrowing the range to $3.80-$3.90, with expected adjusted earnings growth of 8-12% [15][16] - Cash flow guidance was raised, projecting net cash provided by operating activities (excluding special items) between $1.05 billion and $1.09 billion [16][18] Financial Health - As of the end of the quarter, SCI had cash and cash equivalents of $241.3 million, long-term debt of $4.96 billion, and total equity of $1.57 billion [13][18] - Total capital expenditure for 2025 is projected at $315 million, with allocations for capital improvements, cemetery development, and digital investments [14][18]

Core Insights - Kimberly-Clark Corporation (KMB) demonstrated resilient consumer demand and steady volume growth in Q3 2025, despite ongoing margin pressures, with results aligning closely with the previous year's performance under its Powering Care strategy [1] Financial Performance - Adjusted earnings per share (EPS) for Q3 2025 were $1.82, matching the prior year's figure and exceeding the Zacks Consensus Estimate of $1.45 [2] - Net sales reached $4.2 billion, consistent with the prior year, despite a 2.2% negative impact from exiting the private-label diaper business in the U.S. Organic sales increased by 2.5%, supported by a 2.4% rise in volume [3] - The adjusted gross margin was 36.8%, down 170 basis points year over year, primarily due to cost inflation and tariff-related expenses [4] - Adjusted operating profit was $683 million, remaining flat compared to the previous year, with reduced expenses offsetting gross margin challenges [4] Segment Performance - The North America segment reported net sales of $2.7 billion, a decrease of 0.8%, while organic sales grew by 2.7% driven by a 2.6% volume increase [6] - The International Personal Care segment achieved $1.4 billion in sales, up 1.9%, with organic sales growth of 2.1% [7] Financial Health - At the end of the quarter, Kimberly-Clark had cash and cash equivalents of $617 million, long-term debt of $6.47 billion, and total stockholders' equity of $1.468 billion [8] - Year-to-date cash provided by operations was $1.8 billion, with capital spending totaling $741 million and $1.4 billion returned to shareholders through dividends and buybacks [8] Future Outlook - For 2025, organic sales growth is expected to align with market trends at around 2%, with reported net sales facing headwinds from currency movements and business divestitures [11] - Adjusted operating profit is forecasted to rise at a low single-digit rate on a constant-currency basis, impacted by divestitures and unfavorable foreign exchange [12] - Adjusted EPS is anticipated to increase at a low-to-mid single-digit rate, incorporating various impacts from divestitures and higher interest expenses [13] - Management projects adjusted free cash flow of approximately $2 billion for 2025 [14]

Market Overview - Wall Street rebounded after a brief selloff due to renewed U.S.-China trade tensions, with investors optimistic about potential dialogue between the two nations [1][9] - Major indexes displayed resilience, supported by easing monetary policy, solid earnings, and investor confidence in economic stability [2] Investment Strategy - A relative price strength strategy is recommended, focusing on stocks that outperform their sectors despite market turbulence [4][5] - Stocks that have shown better performance than the S&P 500 over the last 1 to 3 months and have solid fundamentals are highlighted as having growth potential [6] Stock Recommendations - **United Natural Foods (UNFI)**: Leading distributor of natural and organic products, with a projected earnings growth of 167.6% for fiscal 2026 and a market cap of $2.5 billion. Shares increased by 102% over the past year [11][12] - **Teladoc Health (TDOC)**: Provides virtual healthcare services, with an expected EPS growth rate of 48.4% over the next 3 to 5 years. The company has a market cap of $6.5 billion and shares have decreased by 6.1% in the past year [13][14] - **Supernus Pharmaceuticals (SUPN)**: Develops treatments for CNS disorders, with a market cap of $2.7 billion and a projected earnings growth of 9.8% for 2025. Shares have risen by 46.8% in the last year [15][16] - **BRP Inc. (DOOO)**: A leader in powersports with a market cap of $4.8 billion, showing a 26.2% increase in earnings estimates for fiscal 2026. Shares gained 19.9% over the past year [17][18] Screening Parameters - Stocks selected based on relative price change over 12 weeks, 4 weeks, and 1 week, alongside positive earnings estimate revisions for the current quarter [8][10]