Sysco & AFLAC

We had two more earnings reports yesterday. Sysco (SYY) reported Q2 EPS of 40 cents which was down 10% from last year but still two cents above Wall Street. The company’s COO said: “Though not in line with our historical performance, our results for the quarter were solid given the difficult economic conditions,” Revenue dropped slightly to $9.1 billion. In November, the company raised its quarterly dividend from 22 cents a share to 24 cents a share, which translates to a yield of 4.1%. The shares rallied 5.6% yesterday. I expect Sysco to have a flattish year this year and next, which isn’t bad considering the environment.
AFLAC (AFL), a company that’s been under a lot of scrutiny lately, reported Q4 EPS of 42 cents which is a 48% drop from last year. But with insurance companies, it’s better to look at operating earnings. There, AFLAC earned 98 cents a share which was two cents below expectations.
The company’s investment losses were pretty big, $262 million. Nearly half came from investments in Icelandic banks. AFLAC also took a major bath in certain collateralized debt obligations.
Despite criticisms from Wall Street, the company has defended itself and said that its balance sheet is strong. AFLAC also said that it expects operating earnings growth of 13% to 15% this year, which means $4.51 to $4.59. AFLAC currently yields nearly 4.9%.

Posted by on February 3rd, 2009 at 5:51 am


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