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J.M. Smucker Declares Quarterly Dividend of $0.75 Per Share

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Price movement

The J.M. Smucker Company (SJM) has a market cap of $17.7 billion. It rose by 0.54% to close at $152.68 per share on July 13, 2016. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were -0.24%, 5.9%, and 25.1%, respectively, on the same day. SJM is trading 2.7% above its 20-day moving average, 10.8% above its 50-day moving average, and 21.3% above its 200-day moving average.

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Related ETFs and peers

The Guggenheim S&P Equal Weight Consumer Staples ETF (RHS) invests 2.6% of its holdings in SJM. RHS tracks an equal-weighted index of large-cap US consumer staples stocks drawn from the S&P 500. The YTD price movement of RHS was 11.8% on July 13.

The market caps of SJM’s closest competitors are as follows:

  • Mondelēz International (MDLZ): $71.6 billion
  • Hormel Foods (HRL): $19.3 billion
  • ConAgra Foods (CAG): $21.1 billion

J.M. Smucker declares dividend

The J. M. Smucker Company has declared a quarterly dividend of $0.75 per share, a rise of 12%, on its common stock. The dividend will be paid on September 1, 2016, to shareholders of record at the close of business on August 12, 2016.

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Performance of J.M. Smucker in fiscal 4Q16 and fiscal 2016

J.M. Smucker reported fiscal 4Q16 net sales of $1.8 billion, a rise of 24.9% over the net sales of $1.4 billion in fiscal 4Q15. Sales of US retail coffee, US retail pet foods, and international and food service rose by 9.4%, 135.4%, and 0.86%, respectively. Sales of US retail consumer foods fell by 2.0% between fiscals 4Q15 and 4Q16.

The company’s net income and EPS (earnings per share) rose to $191.0 million and $1.61, respectively, in fiscal 4Q16, compared with -$90.3 million and -$0.82, respectively, in fiscal 4Q15.

Fiscal 2016 results

In fiscal 2016, SJM reported net sales of $7.8 billion, a rise of 37.2% YoY (year-over-year). The company’s gross profit margin and operating income rose by 9.8% and 48.4%, respectively, in fiscal 2016. Its net income and EPS rose to $688.7 million and $5.76, respectively, in fiscal 2016, compared with $344.9 million and $3.33, respectively, in fiscal 2015.

SJM’s cash and cash equivalents and inventories fell by 12.6% and 22.7%, respectively, in fiscal 2016. Its current ratio and long-term debt-to-equity ratio fell to 1.3x and 1.1x, respectively, in fiscal 2016, compared with 1.9x and 1.2x in fiscal 2015.

Projections

The J.M. Smucker Company (SJM) has made the following projections for fiscal 2017:

  • net sales growth rate of -1%
  • adjusted non-GAAP (generally accepted accounting principles) EPS of $7.60–$7.75, reflecting the share repurchase of 3.4 million shares in fiscal 4Q16
  • free cash flow of $1.0 billion
  • capital expenditures of $240 million
  • effective tax rate of 34.0%

In the next part, we’ll take a look at Mead Johnson & Company.

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