Household products company Reynolds (NASDAQ:REYN) will be announcing earnings results tomorrow before market hours. Here’s what to look for.
Reynolds beat analysts’ revenue expectations by 1% last quarter, reporting revenues of $910 million, down 2.7% year on year. It was a mixed quarter for the company, with a decent beat of analysts’ organic revenue estimates but a miss of analysts’ gross margin estimates.
Is Reynolds a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Reynolds’s revenue to decline 3.6% year on year to $971 million, improving from the 7.5% decrease it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.58 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Reynolds has only missed Wall Street’s revenue estimates once over the last two years, exceeding top-line expectations by 1.2% on average.
Looking at Reynolds’s peers in the household products segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Clorox’s revenues decreased 15.3% year on year, beating analysts’ expectations by 2.8%, and Procter & Gamble reported revenues up 2.1%, topping estimates by 1.3%. Procter & Gamble traded up 2.8% following the results.
Read our full analysis of Clorox’s results here and Procter & Gamble’s results here.
Stocks, especially growth stocks where cash flows further in the future are more important to the story, have had a good 2024. An economic soft landing (so far), the start of the Fed's rate cutting campaign, and the election of Donald Trump were positives for the market, and while some of the household products stocks have shown solid performance, the group has generally underpeformed, with share prices down 3.4% on average over the last month. Reynolds is up 6.1% during the same time and is heading into earnings with an average analyst price target of $31.22 (compared to the current share price of $27.50).
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