HILLSHIRE BRANDS CO. $35 (New York symbol HSH; Conservative Growth Portfolio, Consumer sector; Shares outstanding: 122.9 million; Market cap: $4.3 billion; Price-to-sales ratio: 1.1; Dividend yield: 1.4%; TSINetwork Rating: Average; www.hillshirebrands.com) makes a variety of packaged meat products. Its main brands include Ball Park hot dogs, Jimmy Dean sausages and Hillshire Farm deli meats.
In its 2013 second quarter, which ended December 31, 2012, Hillshire’s sales rose 0.7%, to $1.06 billion from $1.05 billion a year earlier. If you disregard the contribution of a business that the company sold, sales would have risen 2.5%. Without unusual items, earnings per share rose 29.2%, to $0.62 from $0.48.
The earnings increase is partly due to savings from plant closures and layoffs. These moves should cut its costs by $100 million a year by the end of fiscal 2015.
The stock has risen 21% since the company was spun off from Sara Lee in July 2012. It now trades at a high 22.2 times the $1.58 a share that it will likely earn in fiscal 2013. The $0.50 dividend yields 1.4%.
Hillshire Brands is a hold.
