Hormel Foods: Analysts Remain on the Sidelines


Aug. 18 2020, Updated 6:15 a.m. ET

Analysts play it safe with a “hold”

Most of the analysts providing recommendations on Hormel Foods (HRL) have maintained a “hold” rating on the stock ahead of the third fiscal quarter results on August 23. As of August 16, of the 12 analysts covering the stock, 58% recommended a “hold,” 34% recommended a “buy,” and 8% recommended a “sell.”

There hasn’t been price revision activity for Hormel Foods stock in the last 30 days. Currently, analysts’ 12-month average target price for Hormel Foods is $35.75, which reflects a 5.5% downside to the stock’s price as of August 16.

Hormel Foods’ third fiscal quarter sales are expected to increase 7.8%, while its adjusted EPS is expected to increase 14.7% on a YoY basis. Acquisitions, product innovations, and cost cuts should help the top and bottom-line performance.

Hormel Foods faces a plethora of challenges like higher freight costs, commodity inflation, increased private label products, and consumers’ preference for organic and healthy foods. These challenges are denting more food retailers’ profitability and bottom lines.

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Where do Hormel’s peers stand?

Of the 17 analysts covering Tyson Foods (TSN), 29% recommended a “hold,” while 65% recommended a “buy.” Currently, analysts’ target price for Tyson Foods stock is $71.13, which reflects a 16.7% upside to its share price as of August 16.

For Pilgrim’s Pride (PPC), 56.0% of the nine analysts covering the stock recommended a “hold,” while the remaining analysts recommended a “buy.” Analysts’ mean target price for Pilgrim’s Pride stock is $23.57, which indicates a 30.3% upside to its price as of August 16.

Of the 17 analysts covering Campbell Soup (CPB) stock, 35% recommended a “hold,” while 41% recommended a “sell.” Analysts’ mean target price for Campbell Soup stock is $36.08, which indicates a 14.2% downside to its price as of August 16.


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