Revenue expectations

In its fiscal 1Q16, Mondelez International (MDLZ) reaffirmed the fiscal 2016 outlook it announced during its 4Q15 results. The company expects organic net revenue growth of at least 2%. This estimate includes a 125-basis-point headwind from trade optimization and elimination of less profitable SKUs.

Mondelez’s Revenue Expectations for Rest of Fiscal 2016

The company now expects a currency headwind impact of three points on revenue, less than the six points expected earlier. This estimate is based on current exchange rates.

Operating margin and EPS expectations

For 2016, Mondelez expects adjusted operating profit margin to be in the range of 15% to 16%, an expansion of 200 basis points compared to 2015. It expects the margin to be at the lower end of the range mainly because of an impact of a 50-basis-point headwind related to the deconsolidation of the company’s operations in Venezuela. The company also expects an operating margin of 17% to 18% in fiscal 2018.

Peer J.M. Smucker’s (SJM) EPS is expected to be $7.72 for fiscal 2017. ConAgra Foods’ (CAG) and General Mills’ (GIS) EPS is expected to be $2.41 and $3.11 for 2017, respectively. To gain exposure to Mondelez, you can invest in the First Trust NASDAQ-100 Ex-Technology Sector IndexSMFund (QQXT) and the First Trust NASDAQ-100 Equal Weighted IndexSMFund (QQEW). These funds invest 3% of their combined holdings in the stock.

Mondelez also expects adjusted EPS to deliver double-digit growth on a constant currency basis. The adverse effect of currency translation is now expected to be $0.05 down from the earlier estimate of $0.13.

Other expectations

The company expects interest expense to be around $625 million–$650 million and the full-year 2016 tax rate to be in the low 20% range.

Latest articles

Broadcom (AVGO) stock fell ~8.5% after markets closed yesterday following the semiconductor giant's fiscal 2019 second-quarter earnings release. It missed analysts' revenue estimate and cut its fiscal 2019 revenue guidance by $2 billion to $22.5 billion due to sluggishness in its semiconductor solutions business.

The SPDR Gold Shares ETF (GLD), which tracks physical gold prices, has underperformed the broader markets year-to-date, rising just 4.4% compared to the S&P 500’s (SPY) gain of 15.9% as of June 14. The sentiment for gold, however, has been turning around.

Safe havens such as Treasuries and gold were back in favor on June 14 as stocks fell due to rising tensions in the Middle East, concerns over growth, and the looming threat of the US-China trade war. The tech-heavy Nasdaq Composite Index fell 0.67% in the first hour of trading.

Lululemon (LULU) stock rose 2.1% on June 13 in reaction to better-than-expected first-quarter results and an upgraded outlook for fiscal 2019 overall. The company's first-quarter adjusted EPS grew 34.5% to $0.74 on revenue growth of 20.4% to $782.32 million. Analysts had expected EPS of $0.70 and revenue of $755.31 million. Here's why the outlook got an upgrade.

14 Jun

IEA Again Slashes Its Oil Demand Growth Estimate

WRITTEN BY Rabindra Samanta

As of 4:40 AM Eastern Time today, US crude oil active futures were at $51.83, ~4% below their closing level in the previous week. If US crude oil prices stay at those levels today, they'll mark their third week of decline in five weeks.

Amazon is discontinuing its Amazon Restaurants service, which has been delivering food for restaurants in parts of the United States. Amazon Restaurants launched in the United States in 2015 and entered the British market the following year. However, it met strong opposition in the British market.