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On Monday, Citi analyst Thomas Palmer revised the price target for Campbell Soup (NYSE:CPB) stock (NASDAQ:CPB) downward to $33.00 from the previous target of $37.00. Currently trading at $35.52, the stock sits near its 52-week low and appears undervalued according to InvestingPro analysis. Despite this adjustment, the analyst has maintained a Sell rating on the shares. With a robust dividend yield of 4.39% and a 55-year history of consecutive dividend payments, the stock continues to attract income-focused investors. Palmer’s report anticipates that Campbell Soup will announce its fiscal third-quarter earnings for 2025 on June 4, with expectations of results that align with current operating sales growth (OSG) and a slight earnings per share (EPS) beat by $0.01. The company has demonstrated solid performance with 9.15% revenue growth in the last twelve months. This projected beat is attributed to an uptick in the consumption of soups and broths.
However, Palmer noted potential challenges ahead for Campbell Soup, particularly with increased costs of goods sold (COGS) due to tariffs on steel, aluminum, and ingredients for Rao’s pasta sauce. Additionally, there is a concern about declining consumption trends for Rao’s products. These factors contribute to a cautious outlook for the company’s future financial performance.
For the fiscal year 2025, Palmer’s EPS estimate sits at the lower end of Campbell Soup’s guidance range of $2.95 to $3.05. Looking into fiscal year 2026, the analyst’s model predicts flat year-over-year EPS, excluding the impact of an extra week, which is $0.18 below the consensus of estimates compiled by Visible Alpha.
The revision in the price target reflects these concerns about cost pressures and consumption trends that could impact Campbell Soup’s profitability and market performance. As the company prepares to report its upcoming earnings, investors will be watching closely to see how these factors play out in the company’s financial results and future guidance. For deeper insights into Campbell Soup’s financial health and growth prospects, InvestingPro subscribers can access comprehensive analysis, including additional ProTips and detailed valuation metrics in the Pro Research Report.
In other recent news, Campbell’s Company reported fiscal 2024 net sales of $9.6 billion, reflecting the company’s robust brand presence in North America. UBS initiated coverage on Campbell’s with a Sell rating, citing challenges in top-line growth and market share losses, while setting a price target of $36.00. Meanwhile, Bernstein adjusted its price target for Campbell’s to $47.00, maintaining an Outperform rating, amidst concerns over new tariffs affecting raw material costs. Campbell’s also announced a quarterly dividend of $0.39 per share, scheduled for payment on August 4, 2025, to shareholders on record by July 3, 2025.
In leadership changes, Campbell’s appointed Elizabeth Duggan as President of its Snacks division and Janda Lukin as Chief Growth Officer, both aimed at enhancing growth strategies. Additionally, Aaron Gwinner was named Chief Digital & Technology Officer, tasked with driving digital transformation and operational improvements. These appointments are part of Campbell’s broader strategy to strengthen its market position and adapt to industry dynamics. The company’s leadership changes and strategic decisions continue to be pivotal as it navigates the evolving food and beverage landscape.
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