Megan Alexander, an analyst from Morgan Stanley, maintained the Hold rating on Conagra Brands (CAG – Research Report). The associated price target remains the same with $27.00.
Megan Alexander’s rating is based on a combination of factors that reflect both optimism and caution regarding Conagra Brands’ current position. While the company’s stock saw a modest increase, which was expected given the defensive nature of the market, the recent quarterly results were somewhat underwhelming. The miss in organic sales growth was attributed more to market miscalculations than company performance, as management reiterated that results were in line with their expectations.
Despite positive signals such as strong consumption trends and supply chain improvements, which suggest potential growth in the future, there are still challenges ahead. The company faces uncertainties related to supply chain investments and cost outlooks, particularly concerning input cost inflation and tariffs. Additionally, the commodity cost index indicates that inflation levels will remain similar to the previous year, potentially hindering margin expansion. Consequently, the Hold rating reflects a balanced view of these opportunities and risks.
In another report released on March 31, RBC Capital also maintained a Hold rating on the stock with a $27.00 price target.
CAG’s price has also changed slightly for the past six months – from $29.350 to $26.780, which is a -8.76% drop .