WK Kellogg (KLG) Stock Surges on Strong Q3 Earnings, Upbeat Outlook
WK Kellogg Company (KLG) shares are trading significantly higher on Thursday morning after the company released its third-quarter earnings report, exceeding analyst expectations and raising its full-year adjusted EBITDA growth forecast. The positive news has sent investors rushing to buy KLG stock, driving it up over 10% in pre-market trading.
The company reported adjusted earnings per share of 31 cents, surpassing the consensus estimate of 26 cents. Revenue for the quarter also outpaced expectations, coming in at $689 million compared to the analyst consensus of $674 million. While net sales decreased by 0.4% year-over-year, adjusted net sales saw a positive rise of 0.7% compared to standalone adjusted net sales. This positive performance was driven by a 1.8% increase in price/mix, offsetting a 1.1% decrease in volume.
WK Kellogg’s impressive third-quarter results were also reflected in its adjusted EBITDA, which surged 27.5% year-over-year to $65 million. This impressive growth was attributed to the company’s improved top-line performance, continued operational discipline, and the timing of brand-building expenditures.
Strategic Focus and Positive Outlook
Gary Pilnick, Chairman and Chief Executive Officer of WK Kellogg, emphasized the company’s commitment to strategic priorities and its progress in transforming the business. He highlighted the third quarter as marking WK’s first full year as an independent company, showcasing its ability to execute its strategic plan effectively.
Looking ahead, WK Kellogg remains confident in its growth prospects. The company is reaffirming its 2024 adjusted net sales growth guidance while raising its adjusted EBITDA growth forecast. Adjusted net sales growth for 2024 is now expected to be at the lower end of the range, between -1.0% and 1.0%. However, the company is projecting adjusted EBITDA growth for 2024 to be between 5.0% and 6.0%, representing an upward revision from the previous range of 3.0% to 5.0%.
Positive Market Reaction
The market has responded positively to WK Kellogg’s strong third-quarter results and optimistic outlook. KLG shares are currently trading at $18.60, up 10.4% in pre-market trading, signaling investor confidence in the company’s future performance. This surge in share price highlights the market’s belief in WK Kellogg’s ability to navigate the current economic environment and deliver sustained growth in the coming years.
