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Investing.com -- Hormel Foods Corporation (NYSE:HRL) stock dropped 3.4% in premarket trading Wednesday after the food company announced a leadership change and warned of earnings pressure in its fourth quarter.
The maker of SPAM and PLANTERS products said Chief Financial Officer Jacinth Smiley is leaving the company "to pursue other opportunities," with controller Paul Kuehneman stepping in as interim CFO effective October 27. Kuehneman, a 30-year company veteran, will report to interim CEO Jeff Ettinger.
While Hormel expects strong fourth-quarter sales growth "toward the top end" of its previous guidance range, the company warned that adjusted earnings per share will come in approximately $0.08 to $0.09 below prior expectations. The shortfall stems from "persistent inflation in key commodity inputs" exceeding expectations and impacts from avian influenza in the poultry industry.
Further operational challenges emerged late in the quarter, including a fire at the company’s Little Rock, Arkansas peanut butter facility and a voluntary Class 1 recall of certain chicken products sold through foodservice channels. The company expects the Arkansas facility to resume full production in early fiscal 2026.
Hormel also anticipates recording non-cash impairment charges primarily related to its International segment and snack nuts business when it reports complete fourth-quarter results in early December.
Despite these headwinds, Ettinger expressed confidence in the company’s portfolio, noting "continued top-line momentum" across retail, foodservice, and international businesses, with particular strength in its turkey portfolio and PLANTERS brand.
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