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How General Mills Beat Analysts’ EPS Estimate


Jun. 28 2019, Updated 9:41 a.m. ET

EPS surpass analysts’ estimate

In fiscal 2019’s fourth quarter, General Mills’ (GIS) adjusted EPS rose 5.1% YoY (year-over-year) to $0.83, beating analysts’ estimate of $0.77. It has now beaten their EPS estimates for six consecutive quarters.

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Growth drivers

General Mills’ adjusted EPS were boosted by higher net price realization, a favorable mix, cost and productivity savings, and a lower effective tax rate. Its adjusted effective tax rate fell 610 basis points YoY to 20.6% from 26.7%. However, the company’s EPS were dragged down by lower organic volumes, input cost inflation, and its outstanding share count rising 3%.

Lower tax has supported several other major packaged food companies’ bottom lines. J.M. Smucker’s adjusted EPS rose ~8% YoY in the last quarter, reflecting a 620-basis-point decline in its adjusted tax rate, and Hershey’s (HSY) adjusted EPS grew by double digits, reflecting improved underlying sales, margin expansion, and lower tax. Lower tax also supported Mondelēz International’s (MDLZ) and Campbell Soup’s (CPB) EPS during their last reported quarters. In fiscal 2020, General Mills expects its constant-currency adjusted EPS to rise 3%–5%.


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