NYSE$CAG

ConAgra Foods Inc · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Conagra's Q4 2020 earnings were marked by a significant increase in net sales and adjusted EPS, driven by elevated retail demand due to the COVID-19 pandemic.

Conagra Brands reported strong fourth-quarter results, with net sales increasing by 25.8% and adjusted EPS more than doubling. The company benefited from increased at-home eating due to the COVID-19 pandemic, which boosted retail demand and offset reduced foodservice demand. Conagra exceeded its free cash flow guidance and reduced its leverage ratio.

  • Net sales increased 25.8%, with organic net sales up 21.5%, driven by double-digit growth in all three retail segments.
  • Diluted EPS grew 57.7% to $0.41, and adjusted EPS more than doubled to $0.75.
  • The company reduced total debt by $271 million and net debt by $725 million, progressing against deleveraging commitments.
  • Guidance for first quarter fiscal 2021 includes organic net sales growth of 10% to 13% and adjusted EPS in the range of $0.54 to $0.59.

Headline financials

Total Revenue

$3.29B

Previous: $2.61B+25.8%
EPS (adj)

$0.75

Previous: $0.36+108.3%
Organic Sales Growth

21.5%

Previous: 0.0%
Adjusted EBITDA

$690M

Previous: $458M+50.5%
Capital Expenditures

$104M

Previous: $117M-10.9%
Free Cash Flow

$1.47B

Previous: $252M+484.1%
Net Income

$201M

Previous: $127M+59.1%
Operating Income

$391M

Previous: $313M+24.7%
Gross Profit

$923M

Previous: $708M+30.3%
Cash & Equivalents

$553M

Previous: $237M+133.9%
Total Assets

$22.3B

Previous: $22.2B+0.4%
Stock-Based Comp

$30.2M

Previous: $11.2M+169.6%

Revenue & EPS history

ConAgra · Revenue · Quarterly

$3.29B

Q4 2020+25.8%vs Q4 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

ConAgra · $458M total across 2 segments · Q4 2020

  • International
    $266M
  • Foodservice
    $193M

Forward guidance

Conagra provided first quarter fiscal 2021 guidance, expecting organic net sales growth of 10% to 13% and adjusted EPS of $0.54 to $0.59. The company anticipates retail and foodservice demand levels to trend toward historical norms as the fiscal year progresses.

Tailwinds

  • Organic net sales growth of 10% to 13%.
  • Adjusted operating margin of 17.0% to 17.5%.
  • Adjusted EPS of $0.54 to $0.59.
  • Confidence in achieving leverage ratio target of 3.5x to 3.6x by the end of fiscal 2021.
  • Reaffirming fiscal 2022 algorithm of organic net sales growth of 1% to 2%.

Headwinds

  • Uncertainty regarding the impact of the COVID-19 pandemic on fiscal 2021 consolidated results.
  • Expectation that retail and foodservice demand levels will trend toward historical norms, but the degree and timing are difficult to predict.
  • Continued reduced demand for foodservice products compared to pre-COVID-19 pandemic levels.
  • COVID-19 related costs continuing to impact the business.
  • Guidance assumes the end-to-end supply chain operates effectively during this period of heightened demand.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 19 quarterly earnings reports · overlaid with Q4 2020

Historical avgQ4 2020

+0.4%

Avg return

Earnings day

-0.5%

Avg return

5 days after

-0.0%

Avg return

30 days after

50%

36 / 72 earnings

Positive

+20.7%

Q2 2020

Best reaction

-23.9%

Q2 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q3 2026-0.1%-6.2%
Q2 2026-2.6%-4.0%-4.7%
Q1 2026+5.5%+2.2%-6.1%
Q4 2025-1.3%-6.2%-6.8%
Q3 2025+1.5%-5.3%-9.6%
Q2 2025-0.9%+1.0%-5.7%
Q1 2025-10.3%-11.1%-11.5%
Q4 2024-1.6%+0.6%+4.7%
Q3 2024+7.0%+7.6%+5.3%
Q2 2024-3.7%+0.1%+0.6%
Q1 2024-0.5%+3.8%+4.8%
Q4 2023-0.2%-2.4%-5.2%
Q3 2023+2.1%-0.0%+0.6%
Q2 2023+6.0%+4.6%-5.7%
Q1 2023-2.8%+0.3%+6.4%
Q4 2022-5.6%-6.4%-3.8%
Q3 2022+0.5%+2.2%+3.6%
Q2 2022+1.8%-0.5%+1.7%
Q1 2022-2.2%-3.1%-5.5%
Q4 2021-5.7%-3.0%-6.5%
Q3 2021-2.8%-0.1%+1.9%
Q2 2021-4.6%-7.9%-3.1%
Q1 2021+3.3%+3.2%-1.7%
Q4 2020+5.8%+5.1%+10.9%
Q3 2020+5.4%+10.6%+18.5%
Q2 2020+20.7%+17.2%+14.7%
Q1 2020+1.3%-1.4%-10.0%
Q4 2019-8.3%-7.8%+0.8%
Q3 2019+15.5%+18.4%+33.3%
Q2 2019-23.9%-27.9%-25.9%
Q1 2019-5.8%-7.3%-1.8%
Q4 2018-6.3%-8.4%-2.5%
Q3 2018+0.5%+2.7%+3.1%
Q2 2018-0.2%+0.2%-1.0%
Q1 2018+1.2%+0.2%+1.0%
Q4 2017-4.3%-5.0%-8.4%
Q3 2017-0.0%-0.7%+0.4%
Q2 2017+4.7%+4.9%+3.0%
Q1 2017+9.2%+10.1%+11.5%
Q4 2016+1.7%+0.3%-1.8%
Q3 2016+1.6%
Q2 2016+3.5%
Q1 2016-6.8%
Q4 2015+2.7%
Q3 2015+5.2%
Q2 2015-0.6%
Q1 2015+5.0%
Q4 2014+3.1%
Q3 2014+1.6%
Q2 2014+5.5%
Q1 2014-3.3%
Q4 2013+4.7%
Q3 2013-2.5%
Q2 2013-0.6%
Q1 2013+7.3%
Q4 2012+3.0%
Q3 2012+1.1%
Q2 2012-1.2%
Q1 2012-1.4%
Q4 2008+0.6%
Q4 2011+0.6%
Q3 2011-0.1%
Q2 2011+0.3%
Q1 2011+0.3%
Q4 2010+1.1%
Q3 2010-0.1%
Q3 2009-0.1%
Q2 2010+0.1%
Q1 2010-0.5%
Q4 2009-0.5%
Q1 2009-0.5%
Q2 2009-0.5%

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