Marzetti (NASDAQ:MZTI) Shares Gap Down on Disappointing Earnings

Key Points

• Marzetti shares plunged after disappointing earnings, opening at $97.95 versus the prior close of $110.93. Quarterly EPS was $1.14, missing the $1.37 consensus estimate, while revenue fell 2.4% year over year to $481.52 million.
• The company maintained a quarterly dividend of $1.00, equivalent to $4.00 annually and a 3.6% yield, with a payout ratio of 57.39%.
• Analyst sentiment remains cautious: price targets were reduced, and coverage reflects two Hold ratings and one Sell rating, producing a consensus “Reduce” rating and a $132.50 target price.

Shares of The Marzetti Company (NASDAQ:MZTI - Get Free Report) gapped down prior to trading on Tuesday following a weaker than expected earnings announcement. The stock had previously closed at $110.93, but opened at $97.95. Marzetti shares last traded at $108.9050, with a volume of 65,415 shares traded.

The company reported $1.14 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.37 by ($0.23). The business had revenue of $481.52 million during the quarter. Marzetti had a net margin of 9.93% and a return on equity of 18.22%. The business's revenue for the quarter was down 2.4% on a year-over-year basis. During the same quarter in the previous year, the business posted $1.74 earnings per share.

Marzetti Dividend Announcement

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, September 30th. Stockholders of record on Tuesday, September 8th were paid a $1.00 dividend. The ex-dividend date was Tuesday, September 8th. This represents a $4.00 annualized dividend and a dividend yield of 3.6%. Marzetti's payout ratio is currently 57.39%.

Analysts Set New Price Targets

• Lancaster Colony Corporation NASDAQ: LANC Is About To Raise The Dividend

MZTI has been the topic of a number of research reports. DA Davidson dropped their target price on shares of Marzetti from $168.00 to $130.00 and set a "neutral" rating on the stock in a research report on Wednesday, August 26th. Weiss Ratings restated a "sell (d+)" rating on shares of Marzetti in a report on Monday, August 17th. Finally, Stephens decreased their price target on shares of Marzetti from $140.00 to $135.00 and set an "equal weight" rating for the company in a research note on Wednesday, October 28th. Two analysts have rated the stock with a Hold rating and one has given a Sell rating to the stock. According to MarketBeat.com, the company presently has an average rating of "Reduce" and a consensus target price of $132.50.

Insider Transactions at Marzetti

In other Marzetti news, CEO Luis Viso sold 997 shares of the stock in a transaction that occurred on Thursday, September 10th. The stock was sold at an average price of $100.81, for a total value of $100,507.57. Following the transaction, the chief executive officer owned 1,047 shares in the company, valued at approximately $105,548.07. This represents a 48.78% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Insiders own 29.30% of the company's stock.

Institutional Investors Weigh In On Marzetti

Several hedge funds and other institutional investors have recently modified their holdings of the company. NewEdge Advisors LLC lifted its holdings in shares of Marzetti by 237.5% in the 2nd quarter. NewEdge Advisors LLC now owns 216 shares of the company's stock worth $25,000 after purchasing an additional 152 shares in the last quarter. IFP Advisors Inc grew its position in Marzetti by 796.3% in the 2nd quarter. IFP Advisors Inc now owns 242 shares of the company's stock valued at $28,000 after purchasing an additional 215 shares during the period. Rockefeller Capital Management L.P. acquired a new stake in Marzetti in the 4th quarter valued at $35,000. Versant Capital Management Inc increased its stake in Marzetti by 447.8% during the 2nd quarter. Versant Capital Management Inc now owns 378 shares of the company's stock valued at $43,000 after purchasing an additional 309 shares in the last quarter. Finally, State of Wyoming bought a new stake in Marzetti during the 1st quarter valued at $56,000. Institutional investors own 66.44% of the company's stock.

Marzetti Stock Down 0.4%

The firm has a market cap of $3.02 billion, a P/E ratio of 15.84 and a beta of 0.35. The stock's 50 day simple moving average is $105.09 and its 200 day simple moving average is $124.90. The company has a debt-to-equity ratio of 0.18, a quick ratio of 0.67 and a current ratio of 1.56.

About Marzetti

T. Marzetti Company is a food manufacturer and marketer based in Columbus, Ohio. The company develops, produces and distributes specialty food products for retail and foodservice customers, with a portfolio focused on dressings, dips, sauces, frozen breads and related prepared foods.

Its brand portfolio includes Marzetti, Simply Dressed, New York Bakery, Sister Schubert's, Flatout, Cardini's and Girard's, among others. These products are sold through grocery retailers and other retail channels, while the company also supplies restaurants, institutional foodservice operators and other commercial customers.

The company traces its roots to 1896, when Teresa Marzetti opened a restaurant in Columbus, Ohio.

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