Hormel Foods (NYSE:HRL) Reaches New 1-Year Low on Disappointing Earnings

Key Points

• Hormel Foods Corporation shares fell to a new 52-week low of $23.71 following the announcement of weaker than expected quarterly earnings, with reported earnings per share at $0.35, missing estimates of $0.41.
• The company’s revenue reached $3.03 billion for the quarter, exceeding analyst estimates, although the net margin was reported at 6.27%.
• Despite the weak earnings, several analysts upgraded Hormel's stock rating, with price targets as high as $35.00 from Goldman Sachs, indicating a potential rebound in investor sentiment.

Hormel Foods Corporation (NYSE:HRL - Get Free Report)'s share price hit a new 52-week low during mid-day trading on Thursday following a dissappointing earnings announcement. The stock traded as low as $23.71 and last traded at $25.13, with a volume of 5514976 shares traded. The stock had previously closed at $29.02.

The company reported $0.35 earnings per share for the quarter, missing analysts' consensus estimates of $0.41 by ($0.06). Hormel Foods had a net margin of 6.26% and a return on equity of 10.06%. The company had revenue of $3.03 billion for the quarter, compared to analysts' expectations of $2.98 billion. During the same quarter in the previous year, the business posted $0.37 EPS. The business's quarterly revenue was up 4.6% on a year-over-year basis. Hormel Foods has set its Q4 2025 guidance at 0.380-0.400 EPS. FY 2025 guidance at 1.430-1.450 EPS.

Analyst Upgrades and Downgrades

Several research analysts have recently weighed in on the company. Bank of America lowered their target price on Hormel Foods from $35.00 to $28.00 and set a "neutral" rating on the stock in a report on Friday. The Goldman Sachs Group cut their target price on Hormel Foods from $35.00 to $31.00 and set a "buy" rating on the stock in a research report on Friday. Barclays reissued an "overweight" rating and issued a $34.00 target price (down previously from $36.00) on shares of Hormel Foods in a research report on Friday. JPMorgan Chase & Co. cut their target price on Hormel Foods from $34.00 to $30.00 and set an "overweight" rating on the stock in a research report on Friday. Finally, Stephens restated an "equal weight" rating and issued a $31.00 price target on shares of Hormel Foods in a research note on Thursday, May 22nd. Four investment analysts have rated the stock with a Buy rating and four have given a Hold rating to the company. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and an average target price of $30.88.

Institutional Investors Weigh In On Hormel Foods

Institutional investors and hedge funds have recently made changes to their positions in the business. MUFG Securities EMEA plc purchased a new stake in shares of Hormel Foods in the second quarter valued at about $26,000. Cromwell Holdings LLC raised its holdings in Hormel Foods by 162.7% during the second quarter. Cromwell Holdings LLC now owns 1,001 shares of the company's stock worth $30,000 after purchasing an additional 620 shares in the last quarter. MJT & Associates Financial Advisory Group Inc. purchased a new position in Hormel Foods during the first quarter worth about $37,000. Migdal Insurance & Financial Holdings Ltd. purchased a new position in Hormel Foods during the first quarter worth about $38,000. Finally, Quarry LP purchased a new position in Hormel Foods during the first quarter worth about $41,000. 40.99% of the stock is owned by hedge funds and other institutional investors.

Hormel Foods Stock Performance

The company has a quick ratio of 1.12, a current ratio of 2.47 and a debt-to-equity ratio of 0.35. The company has a market capitalization of $13.79 billion, a PE ratio of 18.30, a PEG ratio of 5.67 and a beta of 0.31. The stock's fifty day simple moving average is $29.12 and its 200-day simple moving average is $29.62.

About Hormel Foods

Hormel Foods Corporation develops, processes, and distributes various meat, nuts, and other food products to retail, foodservice, deli, and commercial customers in the United States and internationally. It operates through three segments: Retail, Foodservice, and International segments. The company provides various perishable products that include fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamoles, and bacons; and shelf-stable products comprising canned luncheon meats, nut butters, snack nuts, chili, shelf-stable microwaveable meals, hash, stews, tortillas, salsas, tortilla chips, nutritional food supplements, and others.