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On Friday, Stifel analysts maintained a Hold rating on J.M. Smucker (NYSE:SJM) shares, with a steady price target of $120.00. According to InvestingPro data, analyst targets for the stock range from $104 to $135, with the company currently trading at $110.67 and showing a market capitalization of $11.8 billion. The firm’s assessment followed J.M. Smucker’s third-quarter fiscal year 2025 earnings report, which revealed earnings per share (EPS) of $2.61. This figure represented a 5% increase, surpassing both the company’s own projections of a mid-single digit decline and Stifel’s estimate by $0.28. The better-than-expected earnings were attributed to a stronger gross margin and reduced selling, distribution, and administrative (SD&A) expenses.
Despite the earnings beat, J.M. Smucker experienced challenges in its Hostess brand sales, which continued to face pressure and market share loss. In response to these difficulties, the company has revised its fiscal year 2025 revenue guidance downward. However, it has concurrently increased its EPS forecast for the year by $0.10, a 1% rise. This adjustment reflects the strong third-quarter results, improved gross margin expectations, and earlier than anticipated Hostess synergies.
The company’s coffee segment remains a significant factor for fiscal year 2026 earnings growth. Stifel’s analysis suggests a cautious stance, estimating EPS growth slightly below the company’s algorithm for the following year due to substantial coffee inflation.
In summary, Stifel’s report indicates that J.M. Smucker’s third-quarter performance exceeded expectations, leading to an upward revision of its EPS outlook for fiscal year 2025. The firm’s rating and price target for J.M. Smucker stock remain unchanged as it continues to monitor the impact of coffee inflation and the performance of the Hostess brand on the company’s future growth. InvestingPro analysis suggests the stock is currently fairly valued, with additional metrics and insights available in the comprehensive Pro Research Report, which offers deep-dive analysis of SJM and 1,400+ other US stocks.
In other recent news, J.M. Smucker reported its third-quarter earnings for fiscal year 2025, revealing mixed results. The company posted revenues of $2.186 billion, which fell short of consensus estimates by 1.8%, while its adjusted earnings per share (EPS) of $2.61 exceeded expectations, supported by strong margins and a lower tax rate. J.M. Smucker’s management revised its fiscal year 2025 sales guidance downward, citing supply disruptions in the Pet segment and a reduction in orders from Hostess. Despite these challenges, the company remains committed to its long-term strategy of achieving at least 4% growth in its strategic brand sales.
Analysts have responded to these developments with varying adjustments to the company’s stock price targets. Jefferies reduced its price target for J.M. Smucker to $111 from $114, maintaining a Hold rating, while CFRA adjusted its target down to $126 from $131, also maintaining a Hold rating. Bernstein maintained its Market Perform rating with a price target of $104, highlighting mixed results and ongoing uncertainties in the coffee commodity markets. The company has also faced challenges with its Hostess acquisition, leading to an $800 million goodwill write-down and a $200 million impairment charge.
Despite these setbacks, J.M. Smucker’s coffee business showed resilience, and brands like Uncrustables and Cafe Bustelo continue to demonstrate robust growth. The company plans additional coffee pricing actions in the next fiscal year to address green coffee inflation. These developments reflect the company’s ongoing efforts to navigate supply chain disruptions and strategic challenges while maintaining a focus on long-term growth.
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