WK Kellogg Earnings: Sales Sour, but Cost Cuts Pop; Investors Should Serve Up a Helping of Shares

Sales growth has proved elusive for no-moat WK Kellogg over its first few quarters as an independent organization, and the market's patience appears to be wearing thin. Shares fell a mid-single-digit percentage on its second-quarter earnings results as adjusted sales slumped around 3% on a nearly 5% retreat in volumes. This runs counter to the perceived value the category should offer cash-constrained consumers now, but we've been more skeptical, given intensifying competitive pressures in this mature category.