Based in Parsippany, NJ, B&G Foods Inc. (BGS – Free Report) is a small, but widely-followed food company that manufactures, sells, and distributes high-quality branded shelf-stable and frozen foods across the U.S., Canada, and Puerto Rico.

Its diverse portfolio includes brands like B&G, B&M, Cream of Wheat, Green Giant, Las Palmas, Mrs. Dash, Pirate’s Booty, Spice Islands, Back to Nature, and SnackWell’s, among many others.

B&G currently sits at a #5 (Strong Sell) on the Zacks Rank after a disappointing fourth quarter and some hard-hitting analyst downgrades that sent estimates in the wrong direction. What’s next for BGS?

Q4 Results

Even though earnings and revenues missed the Zacks Consensus—the bottom line came in at 57 cents versus 59 cents, while the top line hit $473.3 million versus $490.4 million—both metrics managed to increase year-over-year. Earnings increased 96.6%, while revenues grew 14.5% from the prior-year period.

Net sales at B&G’s Base business totaled $380.9 million, declining just 0.3% year-over-year. Sales in the company’s Green Giant frozen products segment increased 23.4%, and its Pirate Brands grew 11.4% thanks to efficient promotional events and distribution gains.

But, growth seen in these brands was somewhat offset by weak consumption trends in shelf-stable and maple syrup products; heightened competition also hurt B&G’s revenues last quarter.

Additionally, gross profit margin declined 440 basis points year-over-year to 21.4% due to increased expenses in warehousing and distribution.

2018 Guidance

B&G expects net sales to be in the range of $1.72 billion to $1.755 billion, with adjusted EPS in the range of $2.05 and $2.25 per share. Adjusted EBITDA is projected to fall between $347.5 million and $365 million.

Credit Suisse Downgrade

Soon after the company reported its results, Credit Suisse analyst Robert Moskow downgraded the food stock to ‘Underperform’ from ‘Neutral’ on expectations that the company’s management will issue more downward guidance revisions.

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