HRL changes
Pick any two versions below to diff them.
- Price
- $20.40 → $21.95(+7.6%)
- Discount category
- Well below intrinsic value → Below intrinsic value
- Next earnings
- Nov 27, 2026 → Dec 3, 2026
- Next earnings is estimate
- Yes → No
- Thesis
- The market prices Hormel for falling volume in its Retail segment and for years of weak profit growth and leadership changes. In Q3 fiscal 2026, Retail volume fell 9% and its organic net sales fell 3%, because of lower sales of commodity turkey and private label snack nuts. Hormel cut its fiscal 2026 net sales guidance to $12.1 billion to $12.2 billion. It had an interim CEO from mid-2025, and removed: a new CEO, John removed: Ghingo, starts added: Ghingo became CEO on October 26, 2026, with a new CFO since September 8, 2026. The market also has doubts about the $1.055 billion purchase of Brakebush, which adds debt and is not expected to add to adjusted EPS before fiscal 2028. For the gap to close, three things must be true. Adjusted EPS must reach the raised fiscal 2026 range of $1.45 to $1.51, and the fiscal 2027 outlook must show more growth. Retail volume must stop falling, with growth in priority brands such as SPAM, Applegate and Planters. The Brakebush purchase must close in Q1 fiscal 2027 and add to Foodservice growth without a large rise in debt. The Q4 fiscal 2026 report with the fiscal 2027 outlook, removed: expected in late November or early added: on December added: 3, 2026, is the main test, and the first quarters under the new CEO give more evidence. If they pass, the gap can close over the next four to six quarters. The main reason it may not close is weak consumer demand that keeps Retail volume and margins low.
- Checkpoints
- removed: Nov 27, 2026 (estimate): added: Dec 3, 2026: Q4 fiscal 2026 results and the fiscal 2027 outlook. Pending. Watch: Adjusted EPS within $1.45 to $1.51 for fiscal 2026 and a fiscal 2027 outlook with growth in adjusted EPS pass; a miss or a lower 2027 outlook fails. Jan 2027 (estimate): Brakebush purchase closes. Pending. Watch: Closing in Q1 fiscal 2027 at about $1.055 billion with no large new conditions passes; a delay past March 29, 2027, or new conditions from regulators fails. Feb 2027 (estimate): Q1 fiscal 2027: first quarter under the new CEO. Pending. Watch: Retail volume that falls less than in fiscal 2026 and Foodservice growth that continues pass; another large fall in Retail volume fails.
- Recent events
- added: Oct 26, 2026: John Ghingo became President and CEO of Hormel. On October 23, 2026, Hormel ended his employment agreement as President, so he has no specified term as CEO. Sep 30, 2026: Hormel agreed to buy Brakebush Brothers, a value-added chicken company in Wisconsin, for about $1.055 billion in cash. Brakebush had about $1.2 billion of net sales in the last 12 months and has five production plants. Hormel expects to close the purchase in Q1 fiscal 2027, after regulatory approvals, to report it mostly in Foodservice, and to see it add to adjusted EPS from fiscal 2028. Aug 27, 2026: Hormel reported Q3 fiscal 2026 results. Net sales were $2.96 billion and organic net sales fell 2%. Diluted EPS was $0.11 and adjusted EPS was $0.37. The quarter had a $56 million loss on the Brazil sale, a $48 million impairment of a minority investment in Indonesia and a $38 million litigation settlement. Hormel raised its fiscal 2026 adjusted EPS guidance to $1.45 to $1.51, but it cut its net sales guidance to $12.1 billion to $12.2 billion. Aug 24, 2026: Hormel named Ash Bhumbla as Executive Vice President and CFO from September 8, 2026. He was CFO of the Chicken segment of Tyson Foods. Jul 27, 2026: The board appointed John Ghingo, Hormel's President, as President and CEO from October 26, 2026. Jeff Ettinger's service as interim CEO ends on October 25, 2026.