Hormel Foods (NYSE:HRL) Reaches New 12-Month Low Following Analyst Downgrade

Key Points

• JPMorgan downgrade to Neutral with a $23 price target pushed Hormel to a new 52-week low of $20.62 (last $20.95) on heavy trading volume.
• Analyst coverage is mixed — two Buys, six Holds and one Sell — giving an overall Hold consensus and an average target of $27, indicating divergent outlooks despite the recent drop.
• Hormel offers a 5.6% yield (quarterly dividend $0.2925), but a 131% payout ratio signals potential concerns about the dividend's sustainability.

Hormel Foods Corporation (NYSE:HRL - Get Free Report)'s stock price reached a new 52-week low on Thursday after JPMorgan Chase & Co. downgraded the stock from an overweight rating to a neutral rating. JPMorgan Chase & Co. now has a $23.00 price target on the stock. Hormel Foods traded as low as $20.62 and last traded at $20.9490, with a volume of 777581 shares traded. The stock had previously closed at $21.64.

Other research analysts have also issued reports about the stock. Weiss Ratings reaffirmed a "sell (d+)" rating on shares of Hormel Foods in a report on Thursday, January 22nd. Stephens lifted their price objective on shares of Hormel Foods from $25.00 to $27.00 and gave the company an "equal weight" rating in a research report on Friday, February 27th. Wall Street Zen upgraded shares of Hormel Foods from a "sell" rating to a "hold" rating in a research report on Saturday, January 17th. Finally, Zacks Research upgraded shares of Hormel Foods from a "strong sell" rating to a "hold" rating in a research report on Monday, December 29th. Two analysts have rated the stock with a Buy rating, six have issued a Hold rating and one has given a Sell rating to the company's stock. According to MarketBeat, Hormel Foods has an average rating of "Hold" and an average target price of $27.00.

Institutional Trading of Hormel Foods

A number of hedge funds and other institutional investors have recently made changes to their positions in HRL. Caxton Associates LLP bought a new stake in shares of Hormel Foods in the 1st quarter worth approximately $310,000. Empowered Funds LLC raised its holdings in shares of Hormel Foods by 1.8% in the 1st quarter. Empowered Funds LLC now owns 57,500 shares of the company's stock worth $1,779,000 after purchasing an additional 993 shares in the last quarter. Woodline Partners LP raised its holdings in shares of Hormel Foods by 40.8% in the 1st quarter. Woodline Partners LP now owns 24,583 shares of the company's stock worth $761,000 after purchasing an additional 7,129 shares in the last quarter. M&T Bank Corp increased its position in shares of Hormel Foods by 61.6% in the second quarter. M&T Bank Corp now owns 13,114 shares of the company's stock worth $396,000 after acquiring an additional 4,999 shares in the last quarter. Finally, EverSource Wealth Advisors LLC increased its position in shares of Hormel Foods by 214.4% in the second quarter. EverSource Wealth Advisors LLC now owns 4,731 shares of the company's stock worth $143,000 after acquiring an additional 3,226 shares in the last quarter. 40.99% of the stock is currently owned by institutional investors.

Hormel Foods Stock Performance

The firm's 50-day moving average price is $23.66 and its two-hundred day moving average price is $23.60. The firm has a market capitalization of $11.53 billion, a PE ratio of 23.51, a P/E/G ratio of 2.66 and a beta of 0.36. The company has a quick ratio of 1.37, a current ratio of 2.66 and a debt-to-equity ratio of 0.36.

Hormel Foods (NYSE:HRL - Get Free Report) last released its earnings results on Thursday, February 26th. The company reported $0.34 earnings per share for the quarter, topping the consensus estimate of $0.32 by $0.02. The business had revenue of $3.03 billion for the quarter, compared to the consensus estimate of $3.07 billion. Hormel Foods had a net margin of 4.03% and a return on equity of 9.38%. The firm's quarterly revenue was up 1.3% compared to the same quarter last year. During the same period last year, the firm posted $0.35 earnings per share. Hormel Foods has set its FY 2026 guidance at 1.430-1.510 EPS. As a group, research analysts predict that Hormel Foods Corporation will post 1.65 earnings per share for the current fiscal year.

Hormel Foods Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Friday, May 15th. Investors of record on Monday, April 13th will be given a dividend of $0.2925 per share. The ex-dividend date of this dividend is Monday, April 13th. This represents a $1.17 dividend on an annualized basis and a yield of 5.6%. Hormel Foods's payout ratio is presently 131.46%.

About Hormel Foods

Hormel Foods Corporation is a global branded foods company primarily engaged in the production, marketing and distribution of value-added, high-quality meat and food products. The company's portfolio spans a range of categories including refrigerated and frozen meats, pantry staples, specialty foods and shelf-stable items. Through manufacturing facilities located across North America and international markets, Hormel Foods supplies retail grocers, foodservice operators, convenience stores and e-commerce platforms.

Among its best-known brands, Hormel Foods produces SPAM® canned meats, Jennie-O® turkey products, Skippy® peanut butter and Applegate® natural and organic meats.

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