Dean Foods Earnings: Here’s Why Investors Don’t Like These Results

Dean Foods Co. (NYSE:DF) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 3.81%.

Dean Foods Co. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 63.89% to $0.13 in the quarter versus EPS of $0.36 in the year-earlier quarter.

Revenue: Decreased 28.73% to $2.23 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Dean Foods Co. reported adjusted EPS income of $0.13 per share. By that measure, the company missed the mean analyst estimate of $0.14. It missed the average revenue estimate of $2.25 billion.

Quoting Management: “Results for the second quarter were in-line with expectations,” said Gregg Tanner, Chief Executive Officer of Dean Foods. “We successfully offset the majority of the volume deleverage associated with lower volumes in the quarter through execution behind our accelerated cost reduction and productivity agenda. These initiatives build on our competitive advantages and position us to succeed going forward. Additionally, we have continued to make progress in other areas as well, including the recent replacement of our credit facility and the disposition of our remaining WhiteWave ownership interest that delivered $589 million to Dean Foods to further bolster our financial strength and flexibility.”

Key Stats (on next page)…

Revenue decreased 22.62% from $2.88 billion in the previous quarter. EPS decreased 18.75% from $0.16 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.27 to a profit $0.11. For the current year, the average estimate has moved down from a profit of $1.09 to a profit of $0.53 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)