Hormel Retailer Score
Hormel Foods Corp. ranks 37th this year in 3BL Association's 100 Best Corporate Citizens, a drop from last year's 16th rank. The main factors contributing to Hormel's drop in ranking are its climate change, governance, and financial performance.
3BL Association's 100 Best Corporate Citizens
- In 3BL Association's 100 Best Corporate Citizens 2019, Hormel Foods Corp. is ranked 37th, a drop from 16th spot in 2018.
- 100 Best Corporate Citizens is a ranking of the 1,000 largest US public companies according to their environmental, social, and governance (ESG) transparency and performance researched by the Institutional Shareholder Services Inc. (ISS) on the companies' publicly available information.
- According to the reports, Hormel Food Corp. improved on some aspects, such as stakeholders & society, where Hormel climbed to the number 1 spot among the 1,000 companies from last year's 118th. Other areas of improvement were employee relations (13th from 28th) and environment (37th from 70th).
- However, in terms of governance, Hormel fell from last year's 246th rank to 258th, according to ISS-ESG, and 470th in general. The company also significantly dropped in terms of financial performance from 141st in 2018 to this year's 456th.
- Comprising 18% of the scoring - and the top contributing factor to Hormel's overall drop in ranking - was the category climate change. The company dropped to the 122nd spot of the category from 43rd in last year's ranking.
Hormel 3rd Quarter 2019 Results of Operations
- Hormel's relatively low ranking (by 3BL Association) in terms of financial performance can be supported by the company's latest quarterly report, where Hormel reported a decline in "net earnings per diluted share of $0.37, compared to $0.39 per diluted share in the third quarter of fiscal 2018."
- In the report, the company cited "higher effective tax rate and weakness in the grocery products segment" as factors contributing to the decline, which "strong results from refrigerated foods were unable to offset."
- The company's profit in the grocery products segment was "negatively impacted by the divestiture of CytoSport, significantly higher avocado costs, and lower Skippy® peanut butter pricing."
- Hormel also highlighted the Jennie-O Turkey Store segment's decline in profit, which, as reported, is a result of "lower sales from retail and food-service value-added items."
To verify whether Hormel's retail scores dropped recently, our initial strategy was a direct search on business information websites. However, business websites like Simply Safe Dividends and Nasdaq don't seem to have a company scoring for its retail performance. Instead, information about financial performance were found using this strategy, specifically, Hormel's dividend growth slowing down.
A direct search for Hormel's retailer score led us to individual product consumer ratings from retailers such as Walmart, Target, and Amazon, far from our target information. So, we shifted gears and scoured market research websites, such as Kantar. Kantar annually publishes PoweRanking, a ranking of retailers and manufacturers based on metrics ranging from strategy to business fundamentals. Unfortunately, only the top 5 retailers and the top 5 manufacturers are shown on the summary, and the full copy of the report can only be accessed through a paywall. Hormel was not among the top 5 in both 2018 and 2017 ranking, but a deep dive of Kantar news archive revealed that in 2014, Hormel, considered a mid-size manufacturer, was ranked 19th among retailers and manufacturers.
Since the information we got falls outside our acceptable timeline, we moved on towards brand valuation websites, such as Brandz. Like Kantar, Brandz annually publishes Top 75 Most Valuable Global Retail Brands, a ranking of retailers based on their financial value and brand contribution. Unfortunately, Hormel was not in both 2019 and 2018 ranking.
Determined to provide, at least, insights into Hormel's retail scores, we searched news articles that may point us to a metric-based scoring of the company. A press release from Hormel's website claims that the company was named one of the 100 Best Corporate Citizens for the 11th consecutive year. Tracing the source, 3BL Association, an organization that annually ranks 1,000 largest US public companies based on environmental, social, and governance transparency and performance, we found valuable information about this year and last year's scores of Hormel Food Corp. Finally, we corroborated the information using the data from Hormel's latest quarterly report.