UPDATE 1-Hormel cuts full-year profit outlook; shares fall
June 18 (Reuters) - Hormel Foods Corp, which makes Spam lunch meat, cut its full-year earnings outlook on Tuesday, citing weakness in its pork business, softer sales of its refrigerated foods and higher meat costs, and its shares fell nearly 5 percent.
Hormel, which is also a turkey and pork processor, said it expected earnings of $1.88 to $1.96 a share for the year ending in October, down from its prior forecast of $1.93 to $2.03.
Analysts on average had forecast a profit of $1.99 a share, according to Thomson Reuters I/B/E/S.
Hormel was squeezed by higher costs for chicken, pork and beef, a spokesman said.
The company said it would provide more details of the outlook at its investor day on June 26.
Earlier this year, Hormel bought Skippy peanut butter, aiming to diversify away from its core meat businesses.
That move should mitigate some of the risks associated with the lower-margin meat business, said Janney Capital Markets analyst Jonathan Feeney, but he added that the stock still warranted a discount to the broader packaged food sector.
Hormel shares were down $1.89, or 4.6 percent, at $38.76 on the New York Stock Exchange.
- Exclusive: Angry with Washington, 1 in 4 Americans open to secession
- U.S. Secret Service investigates after man jumps White House fence, reaches doors
- North Korea says imprisoned American tried to become 'second Snowden'
- Scots spurn independence in historic vote, devolution battle begins |
- French jets strike in Iraq, expanding U.S.-led campaign against Islamic State |