uploads///Diamond Foods Actual Earnings per Share versus Consensus Estimates

Diamond Foods Beat Consensus Earnings Estimates by 10%

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Oct. 13 2015, Updated 12:05 p.m. ET

Reported EPS

The diluted EPS (earnings per share) was reported at $0.23 in 4Q15. It beat the estimate of $0.21 by 10%. The EPS also showed a 21% rise compared to the same quarter in fiscal 2014. Over the next five years, analysts that follow this company are expecting it to grow the earnings at an average annual rate of 32%. This year, analysts are forecasting that earnings will rise by 69.79% over last year. Analysts expect earnings growth next year of 18.40% over this year’s forecasted earnings.

EPS represents the portion of a company’s profit allocated to each outstanding share of common stock.

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Outlook for fiscal 2016

Diamond Foods provided annual adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) guidance of $131–$136 million and non-GAAP (generally accepted accounting principles) diluted EPS guidance of $1.21–$1.32 for fiscal 2016. Its outlook includes the following expectations:

  • input cost inflation of 1%–2%
  • productivity improvements of 2%–3%
  • exchange rates of $1.55 per British pound and $0.75 per Canadian dollar for fiscal 2016
  • a non-GAAP effective tax rate of 30%–32%
  • stock-based compensation of $10.5 million and 32 million fully-diluted shares outstanding at the end of the fiscal year
  • cash tax payments of ~$1 million reflecting the current $348 million tax NOL (net operating loss)

Fiscal 2016 adjusted EBITDA, a non-GAAP financial measure, excludes items like interest expense, income taxes, depreciation, amortization, and stock-based compensation. It also excludes certain legal expenses and litigation settlements, acquisition-related costs, asset impairments, and certain other actual and projected costs.

Peers’ performance

Diamond Foods’ main peers are Campbell Soup (CPB), General Mills (GIS), and Mondelez (MDLZ). They recorded an EPS of $0.49, $0.30, and $0.25 for their last reported quarter.

The First Trust Consumer Staples Alpha DEX Fund (FXG) invests 1.87% and the Power Shares S&P 500 Low Volatility (SPLV) invests 0.95% of its portfolio in Campbell Soup.

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