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On Monday, Goldman Sachs analysts downgraded ConAgra stock (NYSE: CAG) from Neutral to Sell. The decision was influenced by anticipated margin pressures stemming from tariffs and rising input costs, including animal proteins. The stock, currently trading at $22.39, has fallen nearly 17% over the past six months and is trading near its 52-week low of $21.98, according to InvestingPro data.
Goldman Sachs set a new price target for ConAgra stock at $21, down from the previous target of $26. The analysts highlighted the company’s limited ability to pass through pricing in the current environment, which is marked by continued market share losses. This aligns with broader analyst sentiment, as InvestingPro data shows four analysts have recently revised their earnings expectations downward.
The analysts expect ConAgra’s upcoming fiscal year 2026 guidance, set to be released with the fourth-quarter 2025 results in July, to fall short of consensus estimates. They project an earnings per share of $2.10 for FY26, compared to the Refinitiv consensus of $2.35.
The revised price target suggests a 7% downside potential for ConAgra stock, in contrast to the 10% average upside potential for the rest of Goldman Sachs’ coverage. The downgrade reflects concerns over the company’s ability to navigate the current economic challenges effectively.
In other recent news, Conagra Brands (NYSE:CAG), Inc. has announced the sale of its Chef Boyardee brand to Hometown Food Company for $600 million. This transaction includes the transfer of the Milton, Pennsylvania manufacturing facility and is expected to close in the second quarter of 2025, pending regulatory approval. Chef Boyardee contributed approximately $450 million to Conagra’s net sales in fiscal year 2024. The sale is projected to be about four percent dilutive to Conagra’s adjusted earnings per share for fiscal year 2025. Proceeds from the sale will be used for debt reduction.
Additionally, Conagra has agreed to sell its Van de Kamp’s and Mrs. Paul’s frozen seafood brands to High Liner Foods for $55 million. This divestiture aligns with Conagra’s strategy to focus on growth and innovation in its core frozen offerings. The seafood brands contributed about $75 million to Conagra’s fiscal year 2024 net sales. Citi analysts have adjusted their outlook on Conagra, lowering the price target from $27 to $25 while maintaining a Neutral rating. The sale of Chef Boyardee was noted as a significant factor in this revised estimate.
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