Hormel Foods (NYSE:HRL) Stock Crosses Above 50-Day Moving Average - Time to Sell?

Key Points

• Hormel Foods shares crossed above their 50-day moving average, reaching $20.95 versus the $20.86 average, though the stock remained below its 200-day average of $22.86.
• Analyst sentiment is mostly cautious: the stock has a consensus “Hold” rating from MarketBeat, with six Holds, one Buy and one Sell, and a $25.43 average price target.
• Hormel reported quarterly EPS of $0.37, beating estimates, but revenue fell 2.4% year over year. The company declared a $0.2925 quarterly dividend, equating to a 5.6% yield, while its 185.71% payout ratio raises sustainability concerns.

Hormel Foods Corporation (NYSE:HRL - Get Free Report) crossed above its 50 day moving average during trading on Thursday. The stock has a 50 day moving average of $20.86 and traded as high as $20.95. Hormel Foods shares last traded at $20.8740, with a volume of 2,725,459 shares traded.

Analyst Upgrades and Downgrades

HRL has been the subject of several research reports. Piper Sandler reiterated a "neutral" rating on shares of Hormel Foods in a research report on Tuesday, October 6th. Stephens set a $23.00 price target on Hormel Foods in a research report on Friday, August 28th. Weiss Ratings lowered Hormel Foods from a "hold (c-)" rating to a "sell (d+)" rating in a research note on Friday, August 28th. BNP Paribas Exane reiterated a "neutral" rating and issued a $23.00 price objective (down from $26.00) on shares of Hormel Foods in a report on Wednesday, October 7th. Finally, Barclays reiterated an "overweight" rating and issued a $28.00 price objective (down from $30.00) on shares of Hormel Foods in a report on Wednesday, October 14th. One analyst has rated the stock with a Buy rating, six have assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, Hormel Foods presently has a consensus rating of "Hold" and a consensus price target of $25.43.

Hormel Foods Price Performance

The company has a debt-to-equity ratio of 0.30, a current ratio of 1.88 and a quick ratio of 0.92. The firm has a market capitalization of $11.49 billion, a P/E ratio of 33.13, a P/E/G ratio of 2.43 and a beta of 0.30. The firm's 50 day simple moving average is $20.86 and its two-hundred day simple moving average is $22.86.

Hormel Foods (NYSE:HRL - Get Free Report) last announced its quarterly earnings data on Wednesday, August 26th. The company reported $0.37 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.35 by $0.02. The firm had revenue of $2.96 billion for the quarter, compared to analysts' expectations of $3.03 billion. Hormel Foods had a return on equity of 9.91% and a net margin of 2.82%. The company's revenue for the quarter was down 2.4% compared to the same quarter last year. During the same period last year, the firm earned $0.35 earnings per share. As a group, analysts predict that Hormel Foods Corporation will post 1.48 earnings per share for the current year.

Hormel Foods Announces Dividend

The business also recently declared a quarterly dividend, which will be paid on Monday, November 16th. Investors of record on Tuesday, October 13th will be given a dividend of $0.2925 per share. This represents a $1.17 annualized dividend and a yield of 5.6%. The ex-dividend date is Tuesday, October 13th. Hormel Foods's dividend payout ratio (DPR) is presently 185.71%.

Insider Buying and Selling

In related news, Chairman William A. Newlands acquired 10,000 shares of the stock in a transaction on Monday, October 5th. The stock was purchased at an average price of $20.10 per share, for a total transaction of $201,000.00. Following the completion of the transaction, the chairman owned 76,375 shares of the company's stock, valued at $1,535,137.50. This trade represents a 15.07% increase in their position. The acquisition was disclosed in a document filed with the SEC, which is available at this hyperlink. 0.58% of the stock is owned by company insiders.

Institutional Investors Weigh In On Hormel Foods

Hedge funds and other institutional investors have recently added to or reduced their stakes in the company. BlackRock Inc. purchased a new position in shares of Hormel Foods during the 2nd quarter worth approximately $489,092,000. Dimensional Fund Advisors LP lifted its stake in shares of Hormel Foods by 2.0% in the 1st quarter. Dimensional Fund Advisors LP now owns 6,849,174 shares of the company's stock valued at $155,152,000 after purchasing an additional 134,983 shares during the period. Vest Financial LLC lifted its stake in shares of Hormel Foods by 7.8% in the 2nd quarter. Vest Financial LLC now owns 2,285,103 shares of the company's stock valued at $56,716,000 after purchasing an additional 165,403 shares during the period. Bank of America Corp DE lifted its stake in shares of Hormel Foods by 3.4% in the 1st quarter. Bank of America Corp DE now owns 2,405,895 shares of the company's stock valued at $54,494,000 after purchasing an additional 79,509 shares during the period. Finally, Epoch Investment Partners Inc. bought a new stake in shares of Hormel Foods during the first quarter valued at approximately $44,733,000. 40.99% of the stock is currently owned by institutional investors.

About Hormel Foods

Hormel Foods Corporation NYSE: HRL is a global food company headquartered in Austin, Minnesota. Founded in 1891 by George A. Hormel, the company began as a meat-processing business and has expanded into a broad portfolio of branded food products sold through retail, foodservice and international channels.

Its products include refrigerated and shelf-stable meats, meals, snacks and other prepared foods. Hormel Foods markets products under well-known brands such as Hormel, SPAM, Jennie-O, Applegate, Columbus, Skippy and Planters, although its brand portfolio and business operations may evolve over time.

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