Conagra Brands Faces Cost Risks Through Fiscal 2027, RBC Says

MT Newswires Live04-02

Conagra Brands (CAG) could face slower earnings growth next year as high input costs, weak demand, tariff pressure, and lower visibility weigh on margins, with little support from other segments, RBC said in a note Thursday.

The fiscal Q3 results were mostly in line, with slightly better organic sales helped by modest volume growth, market share gains, and solid results in snacks and frozen food despite soft consumer demand, the investment firm said.

Frozen food is improving after earlier supply issues, while snacks stayed strong for a fifth straight quarter, led by meat snacks and other products that continued to sell well, the firm said.

Free cash flow remains a bright spot, with stronger inventory control, tax efficiency, and cash from Ardent Mills helping the company cut debt and lift its free cash flow conversion outlook, RBC analysts noted.

RBC maintained its sector perform rating for Conagra Brands and cut its price target to $17 from $20.

Price: 15.48, Change: -0.04, Percent Change: -0.26

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