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On Wednesday, Barclays (LON:BARC) reaffirmed an Underweight rating on Campbell Soup (NASDAQ:CPB) stock, with a steady price target of $46.00. According to Barclays analysts, Campbell Soup’s second fiscal quarter earnings per share (EPS) for 2025 slightly exceeded market expectations due to lower-than-anticipated selling, general, and administrative (SG&A) expenses. However, the company experienced a 2% year-over-year decline in organic sales, contrary to its projection of a flat performance.
Campbell Soup reported weaker volumes in both its Meals & Beverages and Snacks segments. The Meals & Beverages division faced a roughly 1% negative impact from a supplier issue with its SpaghettiOs brand. While profitability improved in Meals & Beverages, the Snacks division struggled due to an unfavorable product mix and operational challenges in the fresh bakery business.
The company has also adjusted its full-year 2025 outlook, now expecting organic sales to range from a 2% decline to flat year-over-year, compared to the previously forecasted 0-2% growth. The EPS forecast has been lowered to a range of $2.95-$3.05, marking a midpoint reduction of approximately 5% from the earlier $3.12-$3.22 range. Campbell Soup does not foresee a return to organic sales growth until the fourth fiscal quarter of 2025.
Barclays highlighted that market expectations were already low prior to the company’s earnings release, and this guidance revision is consistent with similar statements from other companies in the packaged food industry. Despite this, Barclays anticipates that Campbell Soup shares may lose some value at the opening of the market, mainly due to persistent challenges in the key Snacks segment.
In other recent news, Campbell Soup Company (NYSE:CPB) reported mixed second-quarter financial results and adjusted its full-year outlook. The company posted adjusted earnings of $0.74 per share, slightly surpassing analyst estimates of $0.73, but its revenue of $2.68 billion fell short of the $2.74 billion consensus forecast. Organic net sales decreased by 2% year-over-year, primarily due to declines in the Snacks segment and lower net price realization. In response to these results, Campbell Soup revised its fiscal 2025 adjusted earnings guidance to $2.95-$3.05 per share, down from the previous outlook of $3.12-$3.22, and below the analyst consensus of $3.12. The company now anticipates organic net sales to range from a decrease of 2% to flat for the full year.
JPMorgan analyst Ken Goldman maintained an Overweight rating on Campbell Soup, setting a price target of $48.00. Goldman noted that the company’s second-quarter performance aligned with some investor expectations, but the downward revision of the full-year operating sales guidance was unexpected. Campbell Soup’s new CEO, Mick Beekhuizen, addressed the financial challenges promptly, reflecting a tempered outlook for the second half of the fiscal year. The company maintained its quarterly dividend of $0.37 per share and generated $737 million in operating cash flow year-to-date, returning $283 million to shareholders through dividends and share repurchases.
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