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J. M. Smucker Down 15% in 6 Months: How to Play Ahead?

The J. M. Smucker Company (NYSE: SJM) has experienced a 15.2% decline in its share value over the past six months, underperforming the industry's decline of 4.8%. In the same time frame, the company's performance has also been unfavorable compared to the broader Zacks Consumer Staples sector and the S&P 500, which grew by 0.6% and 17.2%, respectively. Additionally, the stock is down 29% from its 52-week high of $153.94, indicating a substantial drop from its peak value. SJM is currently trading below both its 50-day and 200-day moving averages, which often signals bearish sentiment among investors. Over the past 60 days, the Zacks Consensus estimate for the current fiscal year has declined 1.5% to $10.03 per share. This downward revision in earnings estimates suggests that analysts have lowered their expectations for the company's financial performance. Image Source: Zacks Investment Research Decoding the Recent Slide The J. M. Smucker has been experiencing elevated selling, distribution, and administrative (SD&A) costs. These costs are expected to increase by approximately 13% in fiscal 2025. This uptick is primarily driven by higher investments in the Uncrustables brand and increased spending on marketing. Apart from this, J.M. Smucker faces challenges from volatile and inflationary coffee commodity prices. The coffee segment's sales declined by 4% to $666.1 million in the fourth quarter of fiscal 2024, primarily due to negative impacts from volume/mix and net price realization, each contributing 2% to the decrease. Management expects rising green coffee costs to impact the business starting from the first quarter of fiscal 2025, though it remains ...