What Happened?
Shares of packaged foods company Hormel (NYSE: HRL) jumped 9.8% in the morning session after the company reported first-quarter results where earnings beat Wall Street expectations while revenue came in-line with forecasts.
The maker of Spam and Skippy peanut butter posted adjusted earnings of $0.40 per share on revenue of $2.97 billion for the quarter. The earnings per share figure topped analyst forecasts of $0.35, while revenue matched the consensus estimate.
Although the company's sales volumes fell 1.2% compared to the same period last year, management reconfirmed its full-year financial guidance for calendar year 2026, reinforcing confidence in its outlook. The positive earnings surprise was a welcome sign for investors, as reflected in the stock's pre-market jump.
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What Is The Market Telling Us
Hormel Foods’s shares are not very volatile and have only had 2 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 9 months ago when the stock dropped 13.4% on the news that the company reported second-quarter earnings that missed analyst expectations and provided a soft profit outlook.
Although Hormel's revenue of $3.03 billion surpassed forecasts, its adjusted earnings of $0.35 per share fell short of the $0.41 consensus estimate. The weaker results were compounded by an adjusted EBITDA that also missed analyst estimates by 17.1%. Looking ahead, the company lowered its full-year adjusted earnings guidance to $1.44 per share at the midpoint.
Additionally, its revenue guidance for the upcoming third quarter came in below expectations, signaling ongoing challenges for the packaged foods company.
Hormel Foods is flat since the beginning of the year, and at $23.45 per share, it is trading 25.7% below its 52-week high of $31.54 from July 2025. Investors who bought $1,000 worth of Hormel Foods’s shares 5 years ago would now be looking at only $483.02.
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