Based in Minneapolis, Minnesota, General Mills, Inc. (GIS) is a leading player in the global food industry, with a market cap of $38.58 billion. As a major food producer, General Mills offers various products across categories, like cereals, snacks, and meals. The company serves a broad spectrum of customers, from individual consumers to large retailers and food service providers.
Shares of General Mills have underperformed the broader market considerably over the past year. GIS has declined 4.6% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 19.6%. However, in 2024, GIS stock is up 6.4%, compared to the SPX’s 12% rise on a YTD basis.
Narrowing the focus, GIS has also underperformed the Consumer Staples Select Sector SPDR Fund (XLP). The exchange-traded fund delivered 9.9% YTD returns.
On Jun. 26, General Mills' shares dropped over 4% following the release of weak Q4 and full-year results. In Q4, net sales of $4.71 billion fell short of the $4.87 billion consensus estimate. The company's adjusted EPS of $1.01 decreased by 10% in constant currency. For fiscal 2024, net sales of $19.90 billion declined by 1% from the previous year. Looking ahead to fiscal 2025, General Mills expects adjusted EPS to range from a decrease of 1% to an increase of 1% from the fiscal 2024 base of $4.52, with free cash flow conversion anticipated to be at least 95% of adjusted after-tax earnings.
For the current fiscal year, ending in May 2025, analysts expect GIS’s EPS to decline marginally year over year to $4.49 on a diluted basis. The company's earnings surprise history is robust. It beat the consensus estimate in each of the last four quarters.
Among the 17 analysts covering GIS stock, the consensus rating is a “Hold.” That’s based on three “Strong Buy” ratings and 14 “Holds.”
This configuration is slightly less bullish than three months ago, with four suggesting a “Strong Buy.”
On Aug. 8, Michael Lavery from Piper Sandler declared a “Buy” rating on General Mills, with a price target of $74, which indicates a 7.1% upside from the current levels. The mean price target of $67.7 indicates that the stock trades at a premium.
On the date of publication, Rashmi Kumari 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.
