Morgan Stanley analyst Megan Alexander has maintained their neutral stance on CAG stock, giving a Hold rating yesterday.
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Megan Alexander’s rating is based on several factors influencing Conagra Brands’ current market position. The company is expected to report first-quarter results that align with expectations, but there is concern about the second quarter due to slowing sales trends and persistent input cost inflation, particularly in protein. This suggests that consensus forecasts for the second quarter might need to be adjusted downward.
Despite these challenges, management is likely to maintain its fiscal year 2026 guidance, as it is early in the year and there is potential for improvement in the latter half. However, the outlook remains realistic rather than conservative, with limited visibility into sales growth and ongoing inflation pressures that could impact pricing strategies and volume recovery. Given these conditions, the stock has underperformed recently, and while the fundamentals are concerning, these issues seem to be recognized by the market, justifying the Hold rating.
In another report released yesterday, J.P. Morgan also maintained a Hold rating on the stock with a $20.00 price target.