Morgan Stanley analyst Megan Alexander maintained a Sell rating on General Mills (GIS – Research Report) yesterday and set a price target of $51.00.
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Megan Alexander’s rating is based on several factors that indicate potential challenges for General Mills. The company is facing decelerating scanner data trends, which have led to a reduction in the earnings per share estimate for the fourth quarter. This decline in retail takeaway suggests a weaker sales performance compared to previous quarters, and there is a possibility of additional retailer inventory cuts. These factors contribute to a lower organic sales growth estimate than previously expected.
Megan Alexander also anticipates a challenging fiscal year 2026 for General Mills, with expectations of a high single-digit percentage decline in earnings per share. This outlook is driven by several headwinds, including profit dilution from the yogurt divestiture, operating profit headwinds from resetting incentive compensation, and potential cost inflation impacts. These challenges, combined with a muted growth in the North American retail category and an uncertain macroeconomic environment, have led to the Sell rating for General Mills’ stock.
According to TipRanks, Alexander is a 4-star analyst with an average return of 5.2% and a 63.33% success rate. Alexander covers the Consumer Cyclical sector, focusing on stocks such as SharkNinja, Inc., Vail Resorts, and Topgolf Callaway Brands.