Smithfield Foods, Inc. reports results for the quarter ended September 30 - Earnings Summary

What happened

Smithfield Foods reported quarterly adjusted earnings of 26 cents per share, below the 58 cents reported a year earlier and under the 33-cent analyst average. Revenue fell 8.3% to $3.44 billion versus the $3.65 billion expected. Net income was $89 million.

Confirmed

Global impact / market context

Lower earnings and weaker revenue than analysts expected suggest Smithfield sold less or earned less per sale, squeezing profit. That can reduce cash available for debt payments, dividends, and capital spending, which matters because the stock has already lost 18.0% this year.

Analyst inference

Analysts had cut their average earnings estimate by about 47.5% over three months, so expectations were already falling before this report. The average analyst rating remains buy, with a median 12-month price target of $23.00, about 20.3% above the last close of $18.33.

Analyst inference

What to watch

1. Whether the average analyst rating stays at buy or shifts after earnings misses; the current split is 4 buy ratings and 3 hold ratings, with no sell ratings. Confirmed
2. Watch for further cuts to earnings estimates, since one analyst negatively revised an estimate in the last 30 days and the average estimate already fell about 47.5% in three months. Proposed
3. Track whether Smithfield's revenue decline continues, because weaker sales can lower profit and cash available, potentially reducing money for debt payments, dividends, and capital spending. Analyst inference

Evidence

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