Maple Leaf Foods Q4 Profit Falls; Shares Plunge

Shares of Maple Leaf Foods (TSE: MFI) dropped 1o% on Thursday morning after the company reported a lower profit in the fourth quarter than a year ago.

Don't Miss our Black Friday Offers:

Unlock your investing potential with TipRanks Premium - Now At 40% OFF!
Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter

Canada’s leading consumer protein company said it faced rising labor and production costs.

Sales & Earnings

Total company sales came in at C$1.12 billion for the quarter ended December 31, a decrease of 0.8% from C$1.13 billion in the prior-year quarter. Meat protein group sales increased 8.2%, while plant protein group sales fell by 3.7%.

Q4 2021 net earnings were C$1.9 million (C$0.02 per share), compared to C$25.4 million (C$0.20 per share) in Q4 2020.

On an adjusted basis, Maple Leaf earned C$0.09 per share in the fourth quarter of 2021, down 71% from an adjusted profit of C$0.31 a year earlier.

CEO Commentary

Maple Leaf president and CEO Michael H. McCain said, “In a challenging environment we delivered another record year in 2021 in our Meat Protein business. While Q4 saw an unexpected tornado of supply chain chaos driven by the Omicron COVID variant, our team is resilient and we expect this storm to pass quickly. For the year, Meat Protein sales grew 8% and we delivered record Adjusted EBITDA of $527 million.”

Wall Street’s Take

Three days ago, BMO Capital analyst Peter Sklar kept a Buy rating on MFI with a C$45.90 price target. This implies 61.3% upside potential.

Overall, consensus on the Street is that MFI is a Strong Buy based on three Buys. The average Maple Leaf Foods price target of C$45.30 implies 59.2% upside potential to current levels.

Download the TipRanks mobile app now

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.