The J.M. Smucker Company - Growth & Income

The J.M. Smucker Company (SJM) recently beat the Zacks Consensus Estimate by 9%, which was its ninth consecutive earnings surprise. Sales are expected to increase 22% next year.

Company Description

J.M. Smucker Co is famous for its jams and jellies, but it also owns an impressive portfolio of household names, including Crisco, Dunkin' Donuts, Folgers, Hungry Jack, Jif, and Pillsbury.

It is headquartered in Orrville, Ohio and has a market cap of $7.2 billion.

First Quarter Results

J.M. Smucker reported EPS of $1.04 for the first quarter of 2011. Overall sales were essentially flat year-over-year, but its domestic coffee business (its largest segment) saw sales growth of 7%. This increase was driven by solid growth in the Folgers brand and double-digit growth in its Dunkin' Donuts brand.

The increase in coffee sales was partially offset by a decrease in the Pillsbury and Crisco divisions.

Strong Dividend Yield

The company has increased its dividend every four quarters since 2002, with an average increase of 11%. It recently upped its dividend 14% from 2009.

The stock currently yields 2.6%, which is about the same yield you would currently get on a 10-year U.S. Treasury note.

Estimates

The Zacks Consensus Estimate is $4.57 for fiscal year 2011, up 5 cents from 30 days ago. The FY2012 estimate is $4.97 per share, representing 9% growth.

Fundamentals

J.M. Smucker currently trades at 13.3x earnings, slightly below the industry average of 14.1. It also trades at 1.3x book value, below the average of 1.9.

It is a Zacks #2 Rank (buy) stock.
 
SMUCKER JM (SJM): Free Stock Analysis Report
 
Zacks Investment Research