Campbell Soup +1.94% stock rose Wednesday, as the food company increased its annual sales forecast.
Earnings per share for the second quarter were 80 cents, which was higher than the 74 cents that analysts had expected. The $2.5 billion sales for the three months ended January were also higher than the expected $2.44 billion.
The market is more inclined to price stocks based upon future expectations than on what is actually on the books. This food and beverage manufacturer increased its lower end of fiscal 2023 adjusted earnings per shares forecast to $2.95 per shared, from $2.90 earlier. This represents a 3.5% increase over the previous year.
The 2023 sales are expected to increase by 10% compared to the 7% to 9.9% forecasted in December and guidance of as high as 6% given in September.
Campbell Soup shares rose 1.3% to $52.79 Wednesday. It recently paid a 37 cents per share quarterly dividend.
A Campbell spokesperson sent an email out highlighting the success of its snack division. This was due to a 15% increase in sales thanks to Pepperidge Farm cookies and Goldfish crackers. According to the spokesperson, Goldfish is now worth more than a billion dollars annually.
Food producers like Kellogg’s (K), and Campbell have increased their prices in order to pass on inflationary input costs and supply chain-related input costs to consumers.
In January, snack prices increased 10.3% annually, while breakfast cereals were up 10.3%.
The packaged food company raised its full-year organic sales growth estimate to 7% to 8.8% from 4%.