Source:  Lisa M. Keefe, MEATINGPLACE, 6/20/11

In the wake of Smithfield Foods’ sterling earnings report recently, analysts weighed in on how the company’s performance changed their expectations for earnings in the future.

For example, Farha Aslam, with Stephens Inc., raised her earnings per share projections for fiscal 2012 to $2.50 from $2.48, previously.

“The company expects to improve its packaged meats business and is committed to maintaining strong pricing discipline in order to deliver normalized margins,” she wrote in a note to investors.

She introduced her fiscal 2013 estimate at $2.75 per share.

Kenneth B. Zaslow, with BMO Capital Markets, introduced his 2013 earnings per share projections at $2.66 per share. He did not change his earnings expectations for Smithfield for fiscal 2012, maintaining it at $2.45 per share, but he said Smithfield’s recent financial statements enabled him to “gain confidence” in those projections, “reflecting SFD's hedges, packaged meat margins, tight hog supplies, and export demand,” he wrote in a report.

Zaslow also said he was “encouraged” that Smithfield had dropped its quest to acquire Spain’s Campofrio for the time being, “though an eventual acquisition of Campofrio appears possible.”

Speculation over Smithfield’s acquisitiveness was ongoing elsewhere, as well, in the wake of a report by Bloomberg that CEO C. Larry Pope had said in an interview that the company “would be interested [in acquisitions] and routinely look at potential opportunities to do something, particularly on the packaged-meats side.”

In early trading on Friday, Smithfield’s stock price ping-ponged within a narrow range of about $21.60 to $22.10 per share, before settling at about $21.80 per share, where the stock price had closed on Thursday.

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