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CAMDEN, N.J. - Campbell Soup Company (NASDAQ:NYSE:CPB) has finalized the sale of its Pop Secret popcorn business to Our Home, a company specializing in better-for-you snacks. The financial details of the deal remain undisclosed.
Pop Secret, a familiar popcorn brand, contributed roughly $120 million to Campbell's net sales in fiscal 2024. The sale is anticipated to reduce the earnings per share for Campbell in fiscal 2025 by about $0.04, a reflection of the transition service agreement and associated costs.
Chris Foley, Campbell’s Executive Vice President and President of Snacks, commented on the transaction, stating it is part of the company's strategy to concentrate on its Snacks division and foster growth among its leading brands.
The transaction was guided by BofA Securities as the exclusive financial advisor, with Blank Rome providing legal counsel to Campbell.
Campbell, with a history spanning over 150 years, has long been a staple in American pantries. The company, which calls Camden, N.J. its home since 1869, reported net sales of $9.4 billion in fiscal 2023. Its portfolio boasts a range of well-known brands including Campbell’s, Goldfish, and Pepperidge Farm, among others.
This announcement contains forward-looking statements which are based on current management expectations and may be subject to risks and uncertainties that could cause actual results to differ materially.
The information in this article is based on a press release statement from Campbell Soup Company.
In other recent news, Campbell Soup has seen a series of analyst updates and strategic developments. Evercore ISI maintained its In Line rating and a stock price target of $49.00, expecting the company's fiscal fourth-quarter earnings to align with expectations. This is in line with TD Cowen's outlook, which raised Campbell Soup's stock target from $46.00 to $47.00 while maintaining a Hold rating. Deutsche Bank also held its rating at Hold with a price target of $48.00.
On the other hand, JPMorgan upgraded Campbell Soup to Overweight, increasing the price target to $52.00. DA Davidson also maintained a Buy rating, raising the price target from $47 to $49. These changes reflect the company's recent acquisition of Sovos Brands and the strong performance of the Meals & Beverages division, despite a slight decline in the Snacks business's organic net sales.
Campbell Soup has made strategic investments to optimize its supply chain and reduce costs, including a $230 million investment and a reduction of 415 roles over two years. Looking ahead, the company anticipates a recovery in the first half of fiscal 2025, with adjusted EBIT growth projected to be around 6.5% to 7% for the full year, and adjusted EPS growth of about 2% to 3%. This suggests a positive trajectory for the company amidst recent developments.
InvestingPro Insights
As Campbell Soup Company (NASDAQ:CPB) navigates the strategic sale of its Pop Secret brand, the company's financial health and market performance remain critical for investors. With a robust market capitalization of $15.06 billion, Campbell is a significant player in the food industry. The company's price-to-earnings (P/E) ratio stands at 20.24, indicating how much investors are willing to pay for each dollar of earnings, which is a vital metric in assessing the company's value.
One of the notable InvestingPro Tips for Campbell is its impressive track record of maintaining dividend payments for 54 consecutive years, demonstrating a strong commitment to shareholder returns. This consistency is a reassuring signal for investors looking for stable income streams. Additionally, Campbell is trading near its 52-week high, with the price hovering at 98.92% of the peak, reflecting investor confidence in the company's performance and future prospects.
InvestingPro Data further reveals that Campbell has experienced a 1.46% revenue growth over the last twelve months as of Q3 2024, with a 6.28% quarterly revenue growth in Q3 2024. The company's gross profit margin stands at a healthy 31.74%, indicating a solid profit-making ability from its sales. Moreover, Campbell's operating income margin is at 15.43%, showcasing efficient management of its operations and costs.
For investors seeking more in-depth analysis and additional InvestingPro Tips, there are 5 more tips available, which can offer further insights into Campbell's financial health and investment potential at https://www.investing.com/pro/CPB.
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