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On Thursday, Campbell Soup (NYSE:CPB) Company (NASDAQ:CPB), currently trading at $39.26 with a market capitalization of $11.7 billion, maintained its Neutral stock rating and a $46.00 price target from DA Davidson. The decision followed the company’s second-quarter fiscal year 2025 performance, which revealed mixed results. While Campbell Soup surpassed earnings expectations with diluted earnings per share of $1.73, it fell short on revenue and lowered its guidance for the full year 2025. According to InvestingPro, six analysts have recently revised their earnings expectations downward for the upcoming period.
Analysts at DA Davidson highlighted that the company’s earnings beat was largely due to reduced marketing and selling expenses, contributing an additional $0.07 to earnings per share (EPS). Lower interest expenses and a reduced number of shares outstanding also positively impacted EPS by $0.02 and $0.01, respectively. Despite current challenges, Campbell maintains a strong dividend track record, having paid dividends consistently for 55 years, with a current yield of 3.98%.
The report from DA Davidson pointed to a broader challenge within the food industry, noting increasing difficulty in navigating the market. Trading near its 52-week low, Campbell Soup shows signs of being slightly undervalued according to InvestingPro’s Fair Value analysis. The firm expressed a generally cautious stance on the sector, despite the company maintaining a healthy 31.12% gross profit margin. The guidance revision was attributed to weaker performance in snack categories, which did not show the sequential improvement that had been anticipated.Want deeper insights? Get access to over 10+ additional exclusive ProTips and comprehensive financial metrics with InvestingPro’s detailed research report.
The firm’s commentary also referenced recent scanner data and headlines, as well as discussions at industry conferences such as the Consumer Analyst Group of New York (CAGNY) conference and other earnings reports, which suggest a toughening landscape for food companies.
Campbell Soup’s recent financial outcomes and the broader market conditions led DA Davidson to continue with a cautious approach, despite the company’s valuation. The stock rating and price target remain unchanged as analysts await clearer signs of improvement within the industry and the company’s performance.
In other recent news, Campbell Soup has faced several adjustments from analysts following its second-quarter fiscal year 2025 performance. The company reported disappointing organic growth and adjusted its full-year guidance, leading analysts to revise their outlooks. TD Cowen cut its price target to $36, maintaining a Hold rating, citing challenges in the Snacks segment and potential tariff impacts. RBC Capital Markets lowered its price target to $44, keeping a Sector Perform rating, noting the company’s prudent move to address current issues despite an attractive valuation. Evercore ISI reduced its target to $46, maintaining an In Line rating, highlighting contrasting trends in the company’s product segments, with weakness in snacks but unexpected strength in broth sales.
Citi also adjusted its price target to $37, maintaining a Sell rating due to declining demand in the Snacks category and concerns over optimistic assumptions in the company’s guidance. JPMorgan downgraded Campbell Soup from Overweight to Neutral, reducing the price target to $37, after reassessing the company’s growth prospects and market valuation. Analysts noted that initial expectations for sales growth from the Rao’s brand and synergies have not materialized as anticipated. These developments reflect a cautious stance from analysts on Campbell Soup’s future performance amidst ongoing market pressures.
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