National Beverage's fourth quarter fiscal 2023 results are unlikely to prove to be a positive catalyst for the company’s shares, according to analysts at UBS.
While the beverage company, whose portfolio of sparkling water, juice, and energy drink brands include La Croix, Clear Fruit, and Mr. Pure, has not yet formally announced an earnings date, the analysts wrote in a note to clients that they expect it to report its latest quarterly results on Thursday, June 29, after the closing bell.
They projected earnings per share of $0.43, above the consensus analyst estimate per Visible Alpha of $0.39, noting that slightly lower sales expectations are offset by much better operating profitability.
They also forecast revenue of $290 million for the quarter, while the Street’s consensus expectation is $297 million.
For the full-year fiscal 2023, UBS’ analysts expect earnings per share of $1.56 on revenue of $1.176 billion.
“While FIZZ shares have performed relatively in line with the XLP (Consumer Staples Select Sector SPDR Fund) since F3Q earnings, we sense that sentiment has been a bit more negative of late given (1) category volumes in tracked channels have decelerated on a two-year stack heading into peak season; and (2) dollar share performance for La Croix continues to move lower,” the analysts wrote.
“With margin recovery, a key pillar of the bull thesis, unlikely to play out sequentially in the quarter despite a steadily improving cost environment given challenged volumes, we believe it is unlikely that the print will prove to be a positive catalyst for the shares.”
The analysts also noted that the results were unlikely to lift National Beverage’s share price as it continues to trade at about a 16% premium to its US beverage peers.
Based on these factors, the analysts awarded the stock a ‘Sell’ rating and a price target of US$48. National Beverage shares are currently trading at US$47.66.
Contact the author at emily.jarvie@proactiveinvestors.com
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