What Happened?
Shares of packaged foods company Conagra Brands (NYSE:CAG) fell 7.7% in the morning session after the company reported underwhelming preliminary full-year 2025 guidance and expects sales and profits to be below its previous forecast. Precisely, the company expects full-year earnings of about $2.35 (vs. previous guidance of $2.45 to $2.50 per share). Organic sales are also expected to decline by 2% year on year (vs previous guidance of a decline between 1.5% and flat growth).
The shares closed the day at $23.90, down 5.5% from previous close.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Conagra? Access our full analysis report here, it’s free .
What The Market Is Telling Us
Conagra’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 5 months ago when the stock dropped 10.1% on the news that the company reported weak third-quarter (fiscal Q1 2025) earnings results. Its organic revenue and EPS missed Wall Street's estimates. While the top line reflected weaker pricing and volumes, management added that sales were also negatively impacted by "approximately $27 million due to temporary manufacturing disruptions in the Hebrew National business during the key grilling season." Overall, this quarter could have been better.
Conagra is down 13.4% since the beginning of the year, and at $23.95 per share, it is trading 27% below its 52-week high of $32.83 from September 2024. Investors who bought $1,000 worth of Conagra’s shares 5 years ago would now be looking at an investment worth $780.64.
Unless you’ve been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. .
