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Q1 net sales rose 1.3% while adjusted EPS beat estimates despite a year-over-year decline.
HRL's Retail sales dropped 2%, while Foodservice and International rose 7% and 8%, respectively.
HRL reaffirmed fiscal 2026 sales of $12.2B-$12.5B and EPS guidance of $1.43-$1.51.
Hormel Foods Corporation (HRL - Free Report) reported first-quarter fiscal 2026 results, with the top line increasing year over year while missing the Zacks Consensus Estimate. The bottom line declined year over year but beat the consensus mark.
Hormel Foods posted adjusted earnings of 34 cents per share, which beat the Zacks Consensus Estimate of 32 cents. The bottom line decreased from 35 cents reported in the year-ago quarter.
Hormel Foods Corporation Price, Consensus and EPS Surprise
Net sales of $3,027.3 million increased 1.3% from $2,988.8 million reported in the year-ago quarter. The metric missed the consensus mark of $3,061 million. Volumes decreased 3.9% in the reported quarter.
HRL’s Quarterly Results: Key Metrics & Insights
Hormel Foods’ gross profit was $469.6 million, down from $475.2 million reported in the year-ago quarter.
Adjusted selling, general and administrative expenses were $238.4 million for the quarter, an increase from $237.5 million in the year-ago period.
Adjusted operating income was $247.4 million, a decrease from $254 million in the same quarter last year. Adjusted operating margin was 8.2%, down from 8.5% reported in the year-ago quarter.
HRL Provides Q1 Revenues & Profit Insights by Segment
Net sales in the Retail unit decreased 2.2% year over year to $1,847.8 million, with volumes and organic volume down 6%, caused by the strategic exit from select non-core private label snack nut items and continued softness in branded and private label packaged deli products. Despite these challenges, key priority brands, including Jennie-O ground turkey and Planters snack nuts, delivered year-over-year net sales growth. The consensus estimate for segment sales was pegged at $1,937 million.
Segment profit decreased 19.3%, largely due to lower sales, elevated raw material input costs and increased logistics expenses.
Net sales in the Foodservice segment increased 7.3% to $998.2 million, while the consensus mark was $982 million. The organic net sales rose 7%, while volume and organic volume remained flat. The increase reflects broad-based growth across multiple channels and categories, with strong performance in customized solutions, premium prepared proteins and branded pepperoni.
Segment profit increased 12.8%, driven by the benefit of pricing actions that remained aligned with market dynamics.
Net sales in the International unit increased 7.6% year over year to $181.3 million, with volumes and organic volume up 1%, reflecting strong performance in multinational operations and branded exports, led by SPAM luncheon meat. Organic volume gains were primarily supported by growth in China and continued strength in branded exports. The consensus estimate for segment sales was pegged at $179 million.
Segment profit increased 9.9%, reflecting lower SG&A expenses and growth in China, partially offset by reduced export margins.
Hormel Foods’ Financial Health Snapshot
This Zacks Rank #3 (Hold) company ended the quarter with cash and cash equivalents of $867.9 million and total long-term debt (excluding current maturities) of $2,851 million. In the fiscal first quarter, cash flow from operations was $349.2 million.
Hormel Foods prioritizes returning capital to its shareholders. The company returned nearly $160 million in the fiscal first quarter to its shareholders via dividends.
What to Expect From HRL in the Future?
Hormel Foods still expects fiscal 2026 net sales to be between $12.2 billion and $12.5 billion, supported by expected organic net sales growth of 1% to 4%. The company anticipates adjusted earnings per share (EPS) to be in the range of $1.43 to $1.51, with growth of 4% to 10%.
HRL stock has gained 9% in the past three months compared with the industry’s growth of 8.4%.
The consensus estimate for Mama's Creations’ current fiscal-year sales and earnings implies growth of 39.9% and 44.4%, respectively, from the year-ago figures. Mama's Creations delivered a trailing four-quarter earnings surprise of 133.3%, on average.
The Hershey Company (HSY - Free Report) engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. It sports a Zacks Rank #1 at present. HSY delivered a trailing four-quarter earnings surprise of 17.2%, on average.
The Zacks Consensus Estimate for Hershey’s current financial-year sales and earnings indicates growth of 4.4% and 29.3%, respectively, from the prior-year reported levels.
US Foods Holding Corp. (USFD - Free Report) engages in the marketing, sale and distribution of fresh, frozen and dry food and non-food products to foodservice customers in the United States. USFD currently carries a Zacks Rank #2 (Buy). US Foods Holding delivered a trailing four-quarter earnings surprise of 2.2%, on average.
The Zacks Consensus Estimate for US Foods Holding’s current fiscal-year sales and earnings implies growth of 5.4% and 20.9%, respectively, from the year-ago figures.
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Hormel Foods Q1 Earnings Beat Estimates, Sales Increase Y/Y
Key Takeaways
Hormel Foods Corporation (HRL - Free Report) reported first-quarter fiscal 2026 results, with the top line increasing year over year while missing the Zacks Consensus Estimate. The bottom line declined year over year but beat the consensus mark.
Hormel Foods posted adjusted earnings of 34 cents per share, which beat the Zacks Consensus Estimate of 32 cents. The bottom line decreased from 35 cents reported in the year-ago quarter.
Hormel Foods Corporation Price, Consensus and EPS Surprise
Hormel Foods Corporation price-consensus-eps-surprise-chart | Hormel Foods Corporation Quote
Net sales of $3,027.3 million increased 1.3% from $2,988.8 million reported in the year-ago quarter. The metric missed the consensus mark of $3,061 million. Volumes decreased 3.9% in the reported quarter.
HRL’s Quarterly Results: Key Metrics & Insights
Hormel Foods’ gross profit was $469.6 million, down from $475.2 million reported in the year-ago quarter.
Adjusted selling, general and administrative expenses were $238.4 million for the quarter, an increase from $237.5 million in the year-ago period.
Adjusted operating income was $247.4 million, a decrease from $254 million in the same quarter last year. Adjusted operating margin was 8.2%, down from 8.5% reported in the year-ago quarter.
HRL Provides Q1 Revenues & Profit Insights by Segment
Net sales in the Retail unit decreased 2.2% year over year to $1,847.8 million, with volumes and organic volume down 6%, caused by the strategic exit from select non-core private label snack nut items and continued softness in branded and private label packaged deli products. Despite these challenges, key priority brands, including Jennie-O ground turkey and Planters snack nuts, delivered year-over-year net sales growth. The consensus estimate for segment sales was pegged at $1,937 million.
Segment profit decreased 19.3%, largely due to lower sales, elevated raw material input costs and increased logistics expenses.
Net sales in the Foodservice segment increased 7.3% to $998.2 million, while the consensus mark was $982 million. The organic net sales rose 7%, while volume and organic volume remained flat. The increase reflects broad-based growth across multiple channels and categories, with strong performance in customized solutions, premium prepared proteins and branded pepperoni.
Segment profit increased 12.8%, driven by the benefit of pricing actions that remained aligned with market dynamics.
Net sales in the International unit increased 7.6% year over year to $181.3 million, with volumes and organic volume up 1%, reflecting strong performance in multinational operations and branded exports, led by SPAM luncheon meat. Organic volume gains were primarily supported by growth in China and continued strength in branded exports. The consensus estimate for segment sales was pegged at $179 million.
Segment profit increased 9.9%, reflecting lower SG&A expenses and growth in China, partially offset by reduced export margins.
Hormel Foods’ Financial Health Snapshot
This Zacks Rank #3 (Hold) company ended the quarter with cash and cash equivalents of $867.9 million and total long-term debt (excluding current maturities) of $2,851 million. In the fiscal first quarter, cash flow from operations was $349.2 million.
Hormel Foods prioritizes returning capital to its shareholders. The company returned nearly $160 million in the fiscal first quarter to its shareholders via dividends.
What to Expect From HRL in the Future?
Hormel Foods still expects fiscal 2026 net sales to be between $12.2 billion and $12.5 billion, supported by expected organic net sales growth of 1% to 4%. The company anticipates adjusted earnings per share (EPS) to be in the range of $1.43 to $1.51, with growth of 4% to 10%.
HRL stock has gained 9% in the past three months compared with the industry’s growth of 8.4%.
Image Source: Zacks Investment Research
Stocks to Consider
Mama's Creations, Inc. (MAMA - Free Report) manufactures and markets fresh deli-prepared foods in the United States. At present, MAMA sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for Mama's Creations’ current fiscal-year sales and earnings implies growth of 39.9% and 44.4%, respectively, from the year-ago figures. Mama's Creations delivered a trailing four-quarter earnings surprise of 133.3%, on average.
The Hershey Company (HSY - Free Report) engages in the manufacture and sale of confectionery products and pantry items in the United States and internationally. It sports a Zacks Rank #1 at present. HSY delivered a trailing four-quarter earnings surprise of 17.2%, on average.
The Zacks Consensus Estimate for Hershey’s current financial-year sales and earnings indicates growth of 4.4% and 29.3%, respectively, from the prior-year reported levels.
US Foods Holding Corp. (USFD - Free Report) engages in the marketing, sale and distribution of fresh, frozen and dry food and non-food products to foodservice customers in the United States. USFD currently carries a Zacks Rank #2 (Buy). US Foods Holding delivered a trailing four-quarter earnings surprise of 2.2%, on average.
The Zacks Consensus Estimate for US Foods Holding’s current fiscal-year sales and earnings implies growth of 5.4% and 20.9%, respectively, from the year-ago figures.