Hormel Foods (HRL) AI Stock Analysis

• Market Cap: $16.79B
• Dividend Yield: 3.75%
• Average Volume (3M): 2.91M
• Price to Earnings (P/E): 22.2
• Beta (1Y): 0.14
• Revenue Growth: -1.84%
• EPS Growth: -5.14%
• Country: US
• Employees: 20,000
• Sector: Consumer Defensive
• Sector Strength: 71
• Industry: Packaged Foods
• EPS (TTM): 0.35
• Shares Outstanding: 549,912,500
• 10 Day Avg. Volume: 2,671,035
• 30 Day Avg. Volume: 2,912,852
• PEG Ratio: -3.48
• Price to Book (P/B): 2.01
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 18.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $33.00
• Price Target Upside: 8.09% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5

Hormel Foods' overall score reflects its financial stability and strong cash flow position, which are its main strengths, alongside a robust dividend yield. However, stagnant revenue growth and valuation concerns weigh on the stock. The technical analysis indicates a stable but not bullish trend, while the earnings call highlights both strategic successes and challenges, notably in supply chain and margin pressures. These factors combine to provide a moderate overall outlook.

Positive Factors

Cost Management

The 'Transformation & Modernization' cost savings program could significantly enhance HRL's bottom line.

Financial Performance

Improved Jennie-O Turkey fundamentals and growing profits in the core Pork base business are positive indicators for HRL.

Negative Factors

Profitability Challenges

All three segments of HRL are expected to post year-over-year profit declines due to tough snack nuts comparisons and higher input costs.

Supply Chain Issues

Supply chain disruptions in 3Q24 have negatively impacted the Planters acquisition, leading to disappointing results.

Hormel Foods Business Overview & Revenue Model

Company Description

Hormel Foods Corporation develops, processes, and distributes various meat, nuts, and food products to retail, foodservice, deli, and commercial customers in the United States and internationally. The company operates through four segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, and International & Other. It provides various perishable products that include fresh meats, frozen items, refrigerated meal solutions, sausages, hams, guacamoles, and bacons; and shelf-stable products comprising canned luncheon meats, nut butters, snack nuts, chilies, shelf-stable microwaveable meals, hashes, stews, tortillas, salsas, tortilla chips, and others. The company also engages in the processing, marketing, and sale of branded and unbranded pork, beef, poultry, and turkey products, as well as offers nutritional food products and supplements, desserts and drink mixes, and industrial gelatin products. It sells its products primarily under the SKIPPY, SPAM, Hormel, Natural Choice, Applegate, Justin's, Jennie-O, Café H, Herdez, Black Label, Sadler's, Columbus, Gatherings, Herdez, Wholly, Columbus, Planters, NUT-rition, Planters Cheez Balls, Corn Nuts, etc. brand names through sales personnel, independent brokers, and distributors. The company was formerly known as Geo. A. Hormel & Company and changed its name to Hormel Foods Corporation in January 1995. Hormel Foods Corporation was founded in 1891 and is headquartered in Austin, Minnesota.

How the Company Makes Money

Hormel Foods generates revenue through the sale of its extensive range of food products across various channels. The company operates primarily through two segments: Refrigerated Foods and Grocery Products. The Refrigerated Foods segment includes the sale of perishable meat and food products to retailers, foodservice operators, and deli customers. The Grocery Products segment focuses on shelf-stable products sold primarily through retail channels. Hormel Foods also benefits from strategic acquisitions, such as the purchase of popular brands that enhance its product portfolio and market reach. Additionally, the company engages in partnerships and collaborations to expand distribution and drive growth. Hormel Foods leverages its strong brand portfolio and extensive distribution network to maintain a competitive edge and achieve consistent revenue growth.

Hormel Foods Financial Statement Overview

Summary

Hormel Foods demonstrates financial stability with strong cash flows and a debt-free balance sheet. Profitability is stable, though revenue growth has been flat, which could pose a challenge for future expansion. The firm’s solid cash position and efficient equity utilization provide a strong foundation, though increasing profit margins could enhance overall financial performance.

Income Statement

The income statement reveals stable performance with a gross profit margin of 16.7% and a net profit margin of 6.3% in the TTM (Trailing-Twelve-Months). Revenue growth is stagnant, as shown by a slight decrease of 0.1% from the previous period. The EBIT margin stands at 8.5%, indicating moderate efficiency in generating operating income. Profitability appears stable, though growth is limited.

Balance Sheet

The balance sheet is strong, characterized by zero total debt, providing excellent financial stability and low risk. The equity ratio is high at 85.6%, suggesting significant asset backing by equity. Return on equity is healthy at 6.6%, indicating efficient use of equity to generate profits, although there is room for improvement in profitability.

Cash Flow

Cash flow analysis shows robust performance with a free cash flow of $890.6 million in the TTM, demonstrating strong cash generation. The operating cash flow to net income ratio is 1.5, highlighting effective cash conversion from earnings. The free cash flow to net income ratio is 1.2, indicating solid cash flow relative to profits, supporting sustainability and potential for growth.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
11.91B	11.92B	12.11B	12.46B	11.39B	9.61B
	Gross Profit
1.99B	2.02B	2.00B	2.16B	1.93B	1.83B
	EBIT
1.01B	1.07B	1.07B	1.31B	1.12B	1.10B
	EBITDA
1.31B	1.37B	1.31B	1.60B	1.40B	1.34B
	Net Income Common Stockholders
756.75M	805.04M	793.57M	999.99M	908.84M	908.08M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
866.41M	766.62M	753.20M	998.26M	634.69M	1.73B
	Total Assets
13.40B	13.43B	13.45B	13.31B	12.70B	9.91B
	Total Debt
2.86B	2.86B	3.31B	3.30B	3.32B	1.30B
	Net Debt
2.02B	2.12B	2.57B	2.32B	2.71B	-410.68M
	Total Liabilities
5.37B	5.43B	5.71B	5.77B	5.72B	3.48B
	Stockholders Equity
8.03B	7.99B	7.73B	7.54B	6.98B	6.43B
Cash Flow		Free Cash Flow
890.57M	1.01B	777.64M	857.28M	771.73M	760.52M
	Operating Cash Flow
1.17B	1.27B	1.05B	1.13B	1.00B	1.13B
	Investing Cash Flow
-242.86M	-236.91M	-689.54M	-258.04M	-3.63B	-656.32M
	Financing Cash Flow
-1.05B	-1.03B	-600.06M	-486.68M	1.52B	566.17M

Hormel Foods Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 30.53
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HRL, the sentiment is Positive. The current price of 30.53 is above the 20-day moving average (MA) of 29.71, above the 50-day MA of 29.76, and above the 200-day MA of 30.27, indicating a bullish trend. The MACD of -0.01 indicates Negative momentum. The RSI at 59.76 is Neutral, neither overbought nor oversold. The STOCH value of 77.62 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HRL.

Hormel Foods Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PPC	75 Outperform	$11.53B	9.58	36.53%	―	2.35%	145.82%
HRL	68 Neutral	$16.79B	22.16	9.54%	3.75%	-1.84%	-5.14%
CAG	68 Neutral	$10.97B	33.63	3.67%	6.09%	-3.15%	-65.38%
MKC	67 Neutral	$20.22B	25.88	14.73%	2.31%	0.40%	10.89%
CPB	66 Neutral	$10.59B	20.46	13.43%	4.28%	9.15%	-31.94%
Sector *	64 Neutral	$8.77B	14.68	4.78%	173.90%	3.25%	2.18%
SJM	55 Neutral	$12.08B	22.22	-3.55%	3.79%	7.07%	-181.54%

Hormel Foods Corporate Events

Hormel Foods Elects D. Scott Aakre to Board

On May 15, 2025, Hormel Foods Corporation announced the election of D. Scott Aakre, their Group Vice President and Chief Marketing Officer – Retail, to the Board of Directors. As an existing employee, Mr. Aakre will not serve as an independent director or receive additional compensation for his board service, which may influence the company’s governance dynamics.

The most recent analyst rating on (HRL) stock is a Sell with a $28.00 price target. To see the full list of analyst forecasts on Hormel Foods stock, see the HRL Stock Forecast page.

Spark’s Take on HRL Stock

According to Spark, TipRanks’ AI Analyst, HRL is a Neutral.

Hormel Foods’ overall score reflects its financial stability and strong cash flow position, which are its main strengths, alongside a robust dividend yield. However, stagnant revenue growth and valuation concerns weigh on the stock. The technical analysis indicates a stable but not bullish trend, while the earnings call highlights both strategic successes and challenges, notably in supply chain and margin pressures. These factors combine to provide a moderate overall outlook.

To see Spark’s full report on HRL stock, click here.