Unpacking Q3 Earnings: Herbalife (NYSE:HLF) In The Context Of Other Consumer Staples Stocks

Earnings results often indicate what direction a company will take in the months ahead. With Q3 behind us, let’s have a look at Herbalife (NYSE:HLF) and its peers.

The consumer staples industry comprises companies engaged in the manufacturing, distribution, and sale of essential, everyday products. These products, also known as "staples," are fundamental to daily living and include packaged food, beverages and alcohol, personal care, and household products. Consumer staples stocks are considered defensive investments because consumers often purchase them regardless of economic conditions. To stand out, companies must have some combination of brand recognition, product quality, and price competitiveness.

The 32 consumer staples stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 12.4% below.

While some consumer staples stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.3% since the latest earnings results.

Herbalife (NYSE:HLF)

With the first products sold out of the trunk of the founder’s car, Herbalife (NYSE:HLF) today offers a portfolio of shakes, supplements, personal care products, and weight management programs to help customers reach their nutritional and fitness goals.

Herbalife reported revenues of $1.24 billion, down 3.2% year on year. This print fell short of analysts’ expectations by 1%, but it was still a strong quarter for the company with an impressive beat of analysts’ earnings and EBITDA estimates.

Interestingly, the stock is up 10.4% since reporting and currently trades at $7.55.

Is now the time to buy Herbalife? Access our full analysis of the earnings results here, it’s free.

Best Q3: Fresh Del Monte Produce (NYSE:FDP)

Translating to "of the mountain" in Spanish, Fresh Del Monte (NYSE:FDP) is a leader in providing high-quality, sustainably grown fresh fruits and vegetables.

Fresh Del Monte Produce reported revenues of $1.02 billion, up 1.6% year on year, outperforming analysts’ expectations by 3%. The business had a stunning quarter with an impressive beat of analysts’ earnings and gross margin estimates.

The market seems happy with the results as the stock is up 10.5% since reporting. It currently trades at $32.11.

Is now the time to buy Fresh Del Monte Produce? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Conagra (NYSE:CAG)

Founded in 1919 as Nebraska Consolidated Mills in Omaha, Nebraska, Conagra Brands today (NYSE:CAG) boasts a diverse portfolio of packaged foods brands that includes everything from whipped cream to jarred pickles to frozen meals.

Conagra reported revenues of $2.79 billion, down 3.8% year on year, falling short of analysts’ expectations by 1.6%. It was a softer quarter as it posted a miss of analysts’ organic revenue growth and EBITDA estimates.

As expected, the stock is down 11.5% since the results and currently trades at $28.95.

Read our full analysis of Conagra’s results here.

Utz (NYSE:UTZ)

Tracing its roots back to 1921 when Bill and Salie Utz began making potato chips in their kitchen, Utz Brands (NYSE:UTZ) offers salty snacks such as potato chips, tortilla chips, pretzels, cheese snacks, and ready-to-eat popcorn, among others.

Utz reported revenues of $365.5 million, down 1.7% year on year. This result was in line with analysts’ expectations. It was a strong quarter as it also put up an impressive beat of analysts’ EBITDA and organic revenue growth estimates.

The stock is up 6.2% since reporting and currently trades at $17.22.

Read our full, actionable report on Utz here, it’s free.

PepsiCo (NASDAQ:PEP)

With a history that goes back more than a century, PepsiCo (NASDAQ:PEP) is a household name in food and beverages today and best known for its flagship soda.

PepsiCo reported revenues of $23.32 billion, flat year on year. This result came in 1.9% below analysts' expectations. Overall, it was a slower quarter as it also produced a miss of analysts’ organic revenue growth estimates and a miss of analysts’ EBITDA estimates.

The stock is flat since reporting and currently trades at $166.18.

Read our full, actionable report on PepsiCo here, it’s free.

Market Update

The Fed cut its policy rate by 50bps (half a percent) in September 2024, the first in roughly four years. This marks the end of its most pointed inflation-busting campaign since the 1980s. While CPI (inflation) readings have been supportive lately, employment measures have bordered on worrisome. The markets will be assessing whether this rate cut's timing (and more potential ones in 2024 and 2025) is ideal for supporting the economy or a bit too late for a macro that has already cooled too much.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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