Kellogg’s Corn Flakes vs. Cheerios – Let Your Taste Buds Decide

Bidness Etc takes a look at the long and interesting history behind Kellogg’s and Cheerios’ rivalry. With more than 100 years of experience each, Kellogg and General Mills are considered the modern pioneers of the cereal industry

Read More : K - GIS

Kellogg – A Cereal Fall In Revenues

The Kellogg Company’s (K) stock price rose 2% after the company announced a planned reduction of 7% in its global workforce by 2017. This announcement was made in its 3QFY13 earnings release on November 5 which beat consensus estimates. However, the company’s growth prospects remain bleak. Its sales in North America are declining as demand for its core product, cereals, is falling and negatively affecting the company’s US Morning Foods and US Snacks segments. Furthermore, its international expansion plans may be in trouble due to a possible shortage of funding, despite the company’s cost-cutting program, Project K.

Beat Estimates and Stock Price Rises

Kellogg’s reported earnings per share (EPS) of $0.90, besting analyst estimates by 4.7%. Sales revenues however, barely matched estimates, and internal revenue growth was just 0.5%. Following the earnings report and the job-cut announcement, the share price initially crept up 2% but then fell back to unchanged level.

Read More : GIS - K

Break your Bowl of Kellogg’s

The Kellogg Company (K) has recently experienced falling demand for its cereal and snack products in the US, which is a significant hurdle as these products constitute a major portion of the company’s revenues. While international expansion is still a key driver for Kellogg’s growth, core product categories (cereal and snacks) have been suffering and the lack of funds could hit the company’s international expansion plans. Bidness Etc thinks Kellogg’s stock is a sell.

 

Kellogg generated 33% of its revenues from international sales in FY12 compared to 32% in FY10. The revenue share from international markets will continue to increase due to growth in these markets and Kellogg’s acquisition of Pringles. Read more.

Kellogg – A Cereal Fall in Revenues

The Kellogg Company’s (K) stock price rose 2% after the company announced a planned reduction of 7% in its global workforce by 2017. This announcement was made in its 3QFY13 earnings release on November 5 which beat consensus estimates. However, the company’s growth prospects remain bleak. Its sales in North America are declining as demand for its core product, cereals, is falling and negatively affecting the company’s US Morning Foods and US Snacks segments. Furthermore, its international expansion plans may be in trouble due to a possible shortage of funding, despite the company’s cost-cutting program, Project K.

Kellogg’s reported earnings per share (EPS) of $0.90, besting analyst estimates by 4.7%. Sales revenues however, barely matched estimates, and internal revenue growth was just 0.5%. Following the earnings report and the job-cut announcement, the share price initially crept up 2% but then fell back to unchanged level. Read more.