Hormel stock sinks toward 3-month low after profit and sales miss, downbeat outlook

Shares Hormel Foods Corp. (HRL) dropped 3.4% toward a three-month low in premarket trading Thursday, after the parent of Planters, Skippy, Spam and Hormel branded food reported fiscal third-quarter profit and sales that missed expectations and cut its full-year outlook, as consumers are expected to remain "highly intentional" in their spending. Net income for the quarter to July 30 fell to $162.7 million, or 30 cents a share, from $218.9 million, or 40 cents a share, in the year-ago period. Excluding nonrecurring items, adjusted earnings per share of 40 cents was just below the FactSet consensus of 41 cents. Sales fell 2.3% to $2.96 billion, below the FactSet consensus of $3.04 billion, as retail sales eased 1.7%, foodservice sales declined 2.9% and international sales shed 6.0%. Meanwhile, overall volume increased 1.9%. For the full year, the company now expects sales to be down 4% to flat from a year ago, compared with previous guidance for growth of 1% to 3%, and adjusted EPS is expected to be $1.61 to $1.67, or below the current FactSet consensus of $1.73. The stock has gained 3.7% over the past three months through Wednesday, while the S&P 500 has advanced 8.0%.

-Tomi Kilgore

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08-31-23 0647ET

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