baked box cheese close up

Nomad Foods (NYSE:NOMD) Q3 Earnings: What Can You Expect?

in EARNINGS/INVESTING IDEAS by

Nomad Foods Limited (NYSE:NOMD) is scheduled to report Q3 earnings results before markets open for trading on November 5, 2020.

The company is expected to report earnings of €0.28/share on revenue of €580.8 million. The consensus earnings per share (EPS) of €0.28/share is based on a poll of 13 analysts and represents a growth in eps of 11.7% over the same quarter last year, when the company reported earnings of €0.25/share.

The revenue forecast of €580.8 million based on a poll of 10 analysts implies a year-over-year (YoY) growth in revenue of 7.5%. Last year the company reported €540.3 million in revenue for the quarter.

Expected to report EPS growth of 11.7% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue €580.84 €540.30 7.5%
EPS €0.28 €0.25 11.7%

Earnings Call Trends

Historically, management has exceeded analyst expectations 6 out of the last 8 tracked quarters, and met expectations 2 quarters.

What are your expectations from Nomad Foods Limited for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 €0.30 €0.34 14.4% Beat
Q1, 2020 €0.29 €0.33 13.6% Beat
Q4, 2019 €0.32 €0.32 0% Met
Q3, 2019 €0.24 €0.25 4.4% Beat
Q2, 2019 €0.23 €0.27 19.8% Beat
Q1, 2019 €0.35 €0.40 15.3% Beat
Q4, 2018 €0.29 €0.29 0% Met
Q3, 2018 €0.23 €0.26 13.1% Beat

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price reacted by increasing 5.0%.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
August 6, 2020 $23.34 $24.50 5.0% Increase
May 7, 2020 $20.72 $21.65 4.5% Increase
February 27, 2020 $18.76 $18.46 −1.6% Decline
November 7, 2019 $19.47 $20.33 4.4% Increase

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.63, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.63 implies a 0.4% chance of earnings manipulation.

Fundamentals And Technical Analysis

Nomad Foods Limited is currently trading at $24.64/share, down −2.6% for the day. The company is trading at approximately 93.4% of its 52-week high of $26.41/share. The company’s stock price is up 0.6% since the last earnings report and down −2.2% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 47.62 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NYSE:NOMD Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 21.10 and a forward P/E multiple of 16.32.

Nomad Foods Limited’s current share price also implies a price-to-book (P/B) multiple of 1.78. The following table summarizes some other key fundamental ratios:

Data as of October 28, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $24.64
P/E Ratio 21.1x
P/E Ratio (Fwd) 16.3x
PEG Ratio 1.2
Total Debt / Total Capital 29.8%
Levered Free Cash Flow €437.1 million
EV / EBITDA 12.9x

Finbox

Nomad Foods Limited is a mid-cap stock with a market capitalization of $4.977 billion and a total enterprise value of $6.319 billion. The company operates in the Consumer Staples sector and the Food Products industry.

Nomad Foods Limited, together with its subsidiaries, produces, markets, and distributes frozen foods in the United Kingdom, Italy, Germany, Sweden, France, Norway, Austria, Spain, and rest of Europe. The company offers fish products, including fish fingers, coated fish, and natural fish; vegetables, such as peas and spinach; and poultry and meat products comprising nuggets, grills, and burgers. It also provides meals products that include ready to cook noodles, pasta, lasagne, pancakes, and other ready-made meals; and other products, such as soups, pizzas, and bakery goods. The company sells its products to supermarkets and food retail chains directly or through distribution arrangements primarily under the Birds Eye, Iglo, Findus, Goodfella’s, La Cocinera, San Marco, and Aunt Bessie’s brands. Nomad Foods Limited was incorporated in 2014 and is headquartered in Feltham, the United Kingdom.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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