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If You Invested $1000 in Hormel Foods 10 Years Ago, This Is How Much You'd Have Now

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For most investors, how much a stock's price changes over time is important. This factor can impact your investment portfolio as well as help you compare investment results across sectors and industries.

FOMO, or the fear of missing out, also plays a role in investing, particularly with tech giants and popular consumer-facing stocks.

What if you'd invested in Hormel Foods (HRL - Free Report) ten years ago? It may not have been easy to hold on to HRL for all that time, but if you did, how much would your investment be worth today?

Hormel Foods' Business In-Depth

With that in mind, let's take a look at Hormel Foods' main business drivers.

Austin, MN-based Hormel Foods Corporation (HRL - Free Report) is a leading manufacturer as well as marketer of various meat and food products in the U.S. and international markets. In fiscal 2017, Hormel Foods reported revenue results through five segments: On Nov 21, 2017, Hormel Foods declared that it has consolidated the Specialty Foods segment into the Grocery Products segment.

Grocery Products (27.2% of total revenues in fiscal 2021): The Grocery Products segment consists primarily of the processing, marketing as well as sale of shelf-stable food products sold predominantly across the retail market.

Refrigerated Foods (49.4% of total revenues in fiscal 2021): The Refrigerated Foods segment includes the Hormel Refrigerated, Burke Corporation (Burke) and Dan's Prize operating segments. The unit consists primarily of the processing, marketing as well as sale of branded and unbranded pork and beef products for retail, food service and fresh-product customers.

Jennie-O Turkey Store (16.7% of total revenues in fiscal 2021): This segment consists primarily of the processing, marketing as well as sale of branded and unbranded turkey products for retail, food service and fresh product customers.

International & Other (6.7% of total revenues in fiscal 2021): This segment includes the Hormel Foods International ('HFI') operating segment, which manufactures markets as well as sells the company's various miscellaneous corporate products internationally.

Bottom Line

Anyone can invest, but building a successful investment portfolio requires research, patience, and a little bit of risk. So, if you had invested in Hormel Foods ten years ago, you're likely feeling pretty good about your investment today.

According to our calculations, a $1000 investment made in August 2012 would be worth $3,558.66, or a 255.87% gain, as of August 19, 2022. Investors should keep in mind that this return excludes dividends but includes price appreciation.

The S&P 500 rose 202.06% and the price of gold increased 4.59% over the same time frame in comparison.

Looking ahead, analysts are expecting more upside for HRL.

Hormel Foods has outpaced the industry in the past six months. The company benefits from brand strength, improved foodservice business and higher pricing. These factors drove second-quarter fiscal 2022 results, with net sales and earnings increasing year over year and beating the Zacks Consensus Estimate. The company’s efforts to enhance the supply chain are notable. Hormel Foods’ strategic buyouts and efforts to raise production are also yielding. However, the company has been battling significant input cost volatility and inflation. Management is seeing higher prices for inputs like raw materials, packaging and supplies, freight and logistics and labor. During the quarter, Hormel Foods’ gross profit margin contracted 40 basis points. It is grappling with escalated SG&A expenses, a trend that continued in the second quarter.

The stock is up 7.78% over the past four weeks, and no earnings estimate has gone lower in the past two months, compared to 1 higher, for fiscal 2022. The consensus estimate has moved up as well.

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