What Happened?
Shares of packaged foods company Hormel (NYSE: HRL) jumped 3.2% in the afternoon session after the company provided an optimistic financial outlook for its 2026 fiscal year, which overshadowed mixed third-quarter results. Although Hormel's revenue of $3.19 billion slightly missed analyst estimates, its adjusted earnings of $0.32 per share surpassed Wall Street's expectations. Investors appeared to focus more on the future, as Hormel projected its adjusted earnings for the 2026 fiscal year to be between $1.43 and $1.51 per share, on revenues of $12.2 billion to $12.5 billion. This forecast came in ahead of what analysts had anticipated. The positive guidance was a key factor in the stock's rise, even as the company noted that profitability in the recent quarter was challenged by high input costs.
The shares closed the day at $24.16, up 3.1% from previous close.
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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 3 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 down 23.4% since the beginning of the year, and at $24.15 per share, it is trading 28% below its 52-week high of $33.55 from December 2024. Investors who bought $1,000 worth of Hormel Foods’s shares 5 years ago would now be looking at an investment worth $509.60.
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