TLDR
- Conagra reports fiscal Q1 2027 earnings Wednesday, September 30, before markets open.
- Analysts expect revenue near $2.59 billion, down about 2% from last year.
- EPS consensus sits at 31 cents, a drop of roughly 21% year over year.
- CAG stock trades near $14, down about 14% year to date.
- Wall Street holds a Hold rating on CAG stock, with price targets ranging from $12 to $16.
Conagra Brands trades near $14 heading into its fiscal first quarter earnings report Wednesday. CAG stock sits down about 14% since the start of the year.
The Chicago food maker behind Slim Jim, Birds Eye, Banquet, and Hunt’s posts results before markets open on September 30.
Wall Street expects a tough quarter. Analysts project revenue near $2.59 billion, a drop of about 2% from last year.
Earnings estimates point to 31 cents per share. That would mark a decline of roughly 21% from the same period last year.
Shoppers are trading down to cheaper food options right now. That shift is hitting the company’s top line.
Inflation Squeezes Margins
Conagra faces higher costs across ingredients, packaging, and shipping. The company expects full-year inflation costs between 5% and 6%.
A $40 million tariff-related cost is expected to hit hardest in this first quarter. Management also plans to spend more on advertising and promotions.
Full-year operating margins are projected between 10% and 10.5%. That’s well below the company’s historic level near 16%.
For the first quarter alone, adjusted operating margin is expected in the high-single-digit range. That would be a step down from last year’s 11.8%.
New pricing moves won’t reach shelves until mid-second quarter. That leaves little room to offset the current pressure this quarter.
Analysts Split on Price Targets
Wall Street ratings on CAG stock stay mostly cautious. The stock carries a Hold consensus from 13 analysts, made up of one Buy, eight Hold, and four Sell calls.
Barclays analyst Andrew Lazar keeps a Buy rating with a $16 price target, pointing to the dividend for support. J.P. Morgan’s Thomas Palmer holds Neutral with a $15 target.
RBC Capital and UBS both set targets at $14. Bank of America and Goldman Sachs rate the stock a Sell with matching $13 targets.
Evercore ISI sets its target at $12.50. Bernstein holds the lowest target on Wall Street at $12, citing ongoing margin pressure and slow grocery volume growth.
The average 12-month price target sits at $13.73. That implies about 3% downside from current levels.
Conagra cut its quarterly dividend to $0.175 per share earlier this year. The move frees up roughly $1 billion over three years for factory upgrades and supply chain investment.
The company is also targeting productivity gains above 4% of cost of goods sold for fiscal 2027. Extra ad spending is focused on frozen meals and meat snacks, two categories showing some volume gains recently.
Zacks currently ranks Conagra a Sell, with an Earnings ESP of +3.22%. The company’s trailing four-quarter earnings surprise averages about 5%.
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