On Friday, Armanino Foods of Distinction reported earnings for the second quarter of 2013. Both sales and earnings were the highest in the history of the company for any quarter, so congratulations to management are in order. Sales rose 2% while earnings per share were up 8%. Management also confirmed that it expects a meaningful increase in both sale and earnings from its new production lines in the fourth quarter.
On the basis of the report, the projected EPS for 2013 remains at 11 cents. Achieving that level of profits will require EPS of 6 cents in the second half compared to the first half's results of 5 cents. The increase, however, is expected since first quarter results were a bit depressed from the price increase of last January which pushed sales and earnings into the fourth quarter of 2012 and also since the bump from the new production line will hit in the fourth quarter.
One disquieting note from the report was the failure to regain sales momentum in Asia which had been one of the big growth areas for the company. According to management, they do not see international sales picking up in the short term. Sadly, there is no explanation of the reason for the slowing international sales. It could be currency fluctuations that have raised Armanino's prices in Japan and elsewhere or it could be a much more serious problem with distribution. We just do not know.
With the projected EPS of 11 cents, the target price for the company's stock remains $2 per share.
On the basis of the report, the projected EPS for 2013 remains at 11 cents. Achieving that level of profits will require EPS of 6 cents in the second half compared to the first half's results of 5 cents. The increase, however, is expected since first quarter results were a bit depressed from the price increase of last January which pushed sales and earnings into the fourth quarter of 2012 and also since the bump from the new production line will hit in the fourth quarter.
One disquieting note from the report was the failure to regain sales momentum in Asia which had been one of the big growth areas for the company. According to management, they do not see international sales picking up in the short term. Sadly, there is no explanation of the reason for the slowing international sales. It could be currency fluctuations that have raised Armanino's prices in Japan and elsewhere or it could be a much more serious problem with distribution. We just do not know.
With the projected EPS of 11 cents, the target price for the company's stock remains $2 per share.
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