Valued at a market cap of $13.6 billion, Camden, New Jersey-based Campbell Soup Company (CPB) operates in the consumer packaged goods sector, focusing on convenient meals, beverages, and snacks. Its well-known brands include Campbell's, Pepperidge Farm, V8, and Prego, serving customers primarily in North America and internationally.
Shares of the soups and foods company have underperformed the broader market over the past 52 weeks. CPB has risen 13.2% over this time frame, while the broader S&P 500 Index ($SPX) has gained 36.8%. In 2024, shares of CPB are up 5.5%, compared to SPX’s 25.7% increase on a YTD basis.
Narrowing the focus, NKE has also lagged behind the Consumer Staples Select Sector SPDR Fund’s (XLP) 17.5% rise over the past 52 weeks and 12.2% return on a YTD basis.
Despite reporting better-than-expected Q4 adjusted earnings of $0.63, Campbell's shares fell 1.8% on Aug. 29 due to its net sales of $2.3 billion, which grew 11% year-over-year but missed the consensus estimate. Concerns also arose from the company's modest organic sales growth forecast (flat to 2%) and a decline in net price realization, indicating challenges in maintaining strong profitability. Additionally, the divestiture of the Pop Secret business is expected to reduce sales and dilute earnings in 2025, which raised concerns
For the current fiscal year, ending in July 2025, analysts expect CPB’s EPS to grow 3.9% year-over-year to $3.20. The company’s earnings surprise history is promising. It beat the consensus estimates in the last four quarters.
Among the 16 analysts covering the stock, the consensus rating is a “Hold.” That’s based on four “Strong Buy” ratings, nine “Holds,” one “Moderate Sell,” and two “Strong Sells.”
This configuration is slightly more bullish than three months ago, with three “Strong Buy” ratings on the stock.
On Sept. 27, DA Davidson downgraded Campbell to "Neutral" with a $51 price target, citing anticipated volume pressures, limited pricing power, and margin constraints from increased marketing and sales reinvestment, with no near-term growth catalyst expected.
The mean price target of $50.75 represents a premium of 11.3% to CPB’s current levels. The Street-high price target of $58, implies a potential upside of 27.2% from the current price.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
