Conagra Brands (NYSE:CAG) Posts Earnings Results, Beats Estimates By $0.13 EPS

Conagra Brands (NYSE:CAG) issued its quarterly earnings results on Wednesday. The company reported $0.41 earnings per share for the quarter, topping the consensus estimate of $0.28 by $0.13, Zacks reports. The firm had revenue of $2.60 billion for the quarter, compared to the consensus estimate of $2.59 billion. Conagra Brands had a positive return on equity of 10.44% and a negative net margin of 16.99%.The company’s revenue for the quarter was down 1.4% on a year-over-year basis. During the same period in the prior year, the business posted $0.39 earnings per share. Conagra Brands updated its FY 2027 guidance to 1.400-1.500 EPS.

Here are the key takeaways from Conagra Brands’ conference call:

• Q2 organic sales are expected to decline approximately 2%, reflecting newly implemented pricing, prudent elasticity assumptions, and seasonal timing around Thanksgiving shipments.
• Full-year inflation remains projected at the high end of the 5%–6% range, as transportation inflation has accelerated and is expected to pressure gross margin and operating profit in Q2 and Q3.
• Despite a Q1 EPS beat driven by lower inflation, SG&A timing, Ardent Mills, and a tariff refund, management reaffirmed its full-year outlook. Q2 margins are expected to fall to the high-single-digit range as inflation rises, one-time SG&A benefits reverse, and A&P spending increases to about 3% of sales.
• Conagra ended Q1 at approximately 4.0x leverage and expects to repay about $250 million of debt this fiscal year, while maintaining a longer-term goal of reaching 3.0x leverage.
• Management is pursuing substantial SKU, format, formulation, and brand simplification, alongside increased marketing and innovation in single-serve meals, meat snacks, and popcorn. Most benefits are expected to emerge in fiscal 2028 through lower complexity, procurement savings, and improved shelf velocity.

Conagra Brands Stock Down 2.7%

Shares of NYSE:CAG traded down $0.39 during trading on Wednesday, hitting $13.74. 3,335,340 shares of the company’s stock traded hands, compared to its average volume of 14,758,300. Conagra Brands has a 52 week low of $12.53 and a 52 week high of $20.32. The company has a current ratio of 0.90, a quick ratio of 0.31 and a debt-to-equity ratio of 1.02. The company has a 50-day moving average price of $15.26 and a 200-day moving average price of $14.62. The company has a market cap of $6.58 billion, a price-to-earnings ratio of -3.42 and a beta of -0.01.

Conagra Brands Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Thursday, December 3rd. Shareholders of record on Thursday, November 5th will be issued a $0.1750 dividend. The ex-dividend date is Thursday, November 5th. This represents a $0.70 annualized dividend and a yield of 5.1%. Conagra Brands’s dividend payout ratio (DPR) is -17.50%.

Analysts Set New Price Targets

Several equities analysts recently issued reports on the stock. Sanford C. Bernstein reissued an “underperform” rating and set a $12.00 price target (down from $16.00) on shares of Conagra Brands in a report on Wednesday, June 3rd. JPMorgan Chase & Co. boosted their target price on Conagra Brands from $14.00 to $15.00 and gave the stock a “neutral” rating in a report on Thursday, July 16th. Weiss Ratings restated a “sell (d)” rating on shares of Conagra Brands in a research report on Tuesday, September 22nd. UBS Group boosted their price objective on Conagra Brands from $13.00 to $14.00 and gave the stock a “neutral” rating in a research note on Thursday, July 16th. Finally, Deutsche Bank Aktiengesellschaft increased their target price on Conagra Brands from $12.00 to $13.00 and gave the stock a “hold” rating in a report on Friday, September 18th. One investment analyst has rated the stock with a Buy rating, eleven have assigned a Hold rating and six have assigned a Sell rating to the stock. Based on data from MarketBeat.com, the stock has a consensus rating of “Reduce” and a consensus target price of $14.13.

Trending Headlines about Conagra Brands

Here are the key news stories impacting Conagra Brands this week:

• Positive Sentiment: Adjusted earnings were $0.41 per share, above the Zacks consensus estimate of $0.31 and up from $0.39 a year ago. Reported diluted EPS was $0.36, while revenue of approximately $2.6 billion narrowly exceeded analysts’ expectations. Resilient demand for pantry staples, including Slim Jim meat snacks, helped support the results. Conagra Brands Surpasses Q1 Earnings and Revenue Estimates
• Positive Sentiment: Management reaffirmed fiscal 2027 guidance, including adjusted EPS of $1.40 to $1.50, organic sales growth ranging from negative 3% to negative 1%, and an adjusted operating margin of 10.0% to 10.5%. Maintaining the outlook may reassure investors despite the weak sales environment. Conagra Brands Reports First Quarter Results
• Neutral Sentiment: Net income rose 6% to $174 million, but results varied by business. Weakness in the Grocery & Snacks and Refrigerated & Frozen segments contributed to a 1.4% year-over-year sales decline. Investors are likely focused on whether productivity initiatives can offset soft category demand.
• Negative Sentiment: Underlying financial pressures remain: operating profit fell 22.7%, gross profit declined 3.4%, free cash flow was negative $128 million, and net debt stood at $7.4 billion. The combination of falling sales, margin pressure and high leverage appears to have limited the positive reaction to the earnings beat. Conagra Brands Beats First-Quarter Profit and Sales Estimates

Conagra Brands Company Profile

Conagra Brands, Inc is a packaged food company headquartered in Chicago, Illinois. The company develops, produces and markets branded food products sold through grocery stores, mass merchandisers, club stores, convenience stores, foodservice operators and e-commerce channels.

Its portfolio includes frozen, refrigerated, grocery and snack products. Well-known brands include Birds Eye, Healthy Choice, Marie Callender’s, Banquet, Duncan Hines, Reddi-wip, Slim Jim, Hunt’s, Chef Boyardee, Orville Redenbacher’s, Vlasic, PAM and Angie’s BOOMCHICKAPOP.