Jefferies lowers ConAgra stock price target to $19 from $23 on margin reset

Investing.com - Jefferies maintained its Hold rating on ConAgra (NYSE:CAG) stock but lowered its price target to $19 from $23, citing persistent inflation and operational challenges. The stock, currently trading near its 52-week low of $18.82, appears undervalued according to InvestingPro Fair Value analysis.

The firm pointed to ConAgra’s fourth-quarter results, which revealed volume declines across all segments leading to deleverage in the company’s financial performance. The company’s revenue declined 3.64% in the last twelve months, with a concerning current ratio of 0.71.

Jefferies noted that ConAgra’s fiscal 2026 guidance reflects a margin reset as management prioritizes brand investment in frozen foods and snacks categories, while simultaneously facing mounting inflation and tariff headwinds.

The research firm highlighted ConAgra’s limited pricing power and elevated costs, characterizing fiscal 2026 as a "transition year" for the food company.

According to Jefferies, ConAgra’s margin recovery beyond fiscal 2026 will depend on productivity improvements, mitigation of tariff and inflation pressures, and volume improvement across its product portfolio.

In other recent news, ConAgra Brands has faced a series of price target reductions from various analyst firms following disappointing financial results and a challenging fiscal outlook. Stifel lowered its price target to $21 from $26 after ConAgra’s fourth-quarter earnings missed expectations, with the company reporting a 3.5% decline in organic sales and a gross margin contraction of 184 basis points. UBS also reduced its price target to $20, expressing skepticism about ConAgra’s aggressive growth projections for fiscal year 2026 and highlighting a potential 40% year-over-year decline in first-half earnings per share. Similarly, Bernstein cut its price target to $21, pointing to significant reinvestment needs and earnings guidance 23% below consensus estimates.

RBC Capital adjusted its price target to $22, citing a challenging quarter and a soft fiscal year 2026 guidance, while noting the company’s strategic investments in brand support and supply chain flexibility. TD Cowen lowered its price target to $19, reflecting concerns over ConAgra’s ability to achieve positive top-line growth amid inflationary pressures and limited pricing power. The firm also highlighted the company’s exposure to lower-income consumers as a potential challenge. These developments indicate a cautious outlook from analysts regarding ConAgra’s near-term financial performance and strategic initiatives.

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