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What Wall Street Recommends for CAG Stock before Q3 Results

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Mar. 13 2019, Published 4:04 p.m. ET

Analysts maintain a “buy” rating

The majority of Wall Street analysts continue to recommend a “buy” for Conagra Brands (CAG) stock. Despite near-term concerns, Conagra Brands’ acquisition of Pinnacle Foods is expected to strengthen the company’s competitive positioning in the frozen food category. The frozen food category is one very few bright spots in the packaged food industry, which is seeing healthy consumer demand. Also, Conagra Brands’ management expects to over-deliver on cost synergies in the long term.

Conagra Brands’ portfolio optimization, focus on innovation, and discounting are likely to support organic sales.

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Ratings and target price

Among the 12 analysts providing recommendations on Conagra Brands, ten suggest a “buy,” one analyst recommends a “hold,” and one analyst suggests a “sell.” Analysts have a consensus target price of $30.82 per share, which indicates an upside of 35.2%, based on its closing price of $22.79 on March 12.

Besides Conagra Brands stock, analysts also maintain a “buy” for Mondelēz (MDLZ) stock in the packaged food sector. Meanwhile, analysts remain on the sidelines for the majority of food stocks, including Kraft Heinz (KHC), J.M. Smucker (SJM), Kellogg (K), Hershey (HSY), and General Mills (GIS). Cost headwinds and higher interest expenses are likely to hurt earnings.

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