General Mills: Premium Valuation and Uncertain Demand Visibility Justify Sell Rating

Peter Grom, an analyst from UBS, maintained the Sell rating on General Mills. The associated price target remains the same with $47.00.

Peter Grom’s rating is based on a combination of factors, primarily revolving around concerns about General Mills’ market positioning and consumer demand visibility. While the company has reaffirmed its long-term growth targets and FY26 guidance, the outlook remains uncertain due to the dynamic and challenging operating environment. The company’s strategy to improve growth in the latter half of the year and into FY27 relies heavily on consumer health and category demand, which currently lacks clear visibility.
Despite recent share price pullbacks, General Mills’ stock continues to trade at a premium compared to its peers in the center store food sector, despite similar growth levels in both top and bottom lines. This premium valuation, coupled with limited visibility into potential improvements in consumer demand, skews the risk/reward balance to the downside. Until there is a narrowing of this premium or increased confidence in forecasted growth, the Sell rating remains justified.

Based on the recent corporate insider activity of 93 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of GIS in relation to earlier this year.