Company Overview - The Campbell's Company, previously known as Campbell Soup, has rebranded to reflect its diverse portfolio of food and beverage products [1] - The product lineup includes well-known brands such as Campbell's, Goldfish, and Rao's [1] Investment Criteria - The company is of interest to investors who prioritize growth in revenue, earnings, and free cash flow [1] - It is considered favorable if the company has excellent growth prospects and favorable valuations [1] - Preference is given to companies with high free cash flow margins, dividend stocks, and generous share repurchase programs [1]

Group 1 - iREIT+HOYA Capital focuses on income-producing asset classes that provide sustainable portfolio income, diversification, and inflation hedging [1] - The consumer staples sector is perceived as undervalued due to low growth expectations compared to the tech sector, presenting potential investment opportunities [2] - The article emphasizes the importance of due diligence for investors before making any investment decisions [3] Group 2 - Seeking Alpha highlights that past performance does not guarantee future results, indicating a cautious approach to investment recommendations [4]

Core Viewpoint - Campbell's Company (CPB) is facing significant challenges, with a 19.7% decline in share price over the past three months, underperforming both the industry and broader market indices [1][4][14] Stock Performance - Campbell's stock closed at $38.81, just above its 52-week low of $37.61, and is trading below its 50 and 200-day moving averages, indicating potential weakness [3][14] Sales and Market Dynamics - The company experienced a 1% decline in organic net sales in the first quarter of fiscal 2025, primarily due to shifting consumer dynamics and cautious spending habits [5][14] - The Snacks division saw a 2% drop in organic net sales, impacted by lower partner brand sales and increased price sensitivity among consumers [6][14] Cost Pressures - Campbell's has been dealing with cost inflation, with a 70 basis point decline in adjusted gross profit margin in the first quarter, largely due to the integration of Sovos Brands [7][14] - The base business experienced a 10-basis point reduction in gross margin, as productivity improvements only partially offset inflation and supply-chain cost pressures [8][14] Earnings Estimates - The Zacks Consensus Estimate for Campbell's earnings per share has been revised downward over the past 60 days, indicating a bearish outlook among analysts [9][14] - Current estimates for the upcoming quarters show a decline from previous projections, reflecting potential challenges in meeting profitability goals [10][14] Growth Opportunities - The Meals & Beverages division reported a 2% pro forma net sales growth in the first quarter, driven by strong performance in the soup portfolio [11][14] - Recent acquisitions, such as Sovos Brands, and strategic divestitures, like the noosa yogurt business, demonstrate Campbell's proactive approach to enhancing market position [12][14] Strategic Focus - The company aims to prioritize execution, innovation, and collaboration with retail partners to improve its market relevance and growth potential [13][14] - Management anticipates sequential improvement in the second quarter, driven by holiday demand and contributions from Sovos Brands starting March 2025 [13][14]

Core Viewpoint - Investors in The Campbell's Company (CPB) should monitor stock movements closely due to significant implied volatility in the options market, particularly for the Jan 17, 2025 $20 Call option [1] Company Analysis - The Campbell's Company currently holds a Zacks Rank of 3 (Hold) within the Food - Miscellaneous industry, which is positioned in the bottom 48% of the Zacks Industry Rank [3] - Over the past 60 days, no analysts have raised their earnings estimates for the current quarter, while five analysts have lowered their estimates, resulting in a decrease of the Zacks Consensus Estimate from 82 cents per share to 74 cents [3] Options Market Insights - The high implied volatility suggests that options traders anticipate a significant price movement for The Campbell's shares, indicating potential trading opportunities [4] - Seasoned options traders often seek high implied volatility options to sell premium, aiming to benefit from the decay of options value if the underlying stock does not move as much as expected [4]

Group 1 - Campbell's Company CPB shares are trading lower, with RBC Capital Markets analyst Nik Modi reiterating a Sector Perform rating and a price forecast of $51 [1] - Despite a challenging consumer environment, management maintains FY25 guidance, expecting steady growth in sales and market share in the second quarter and into the second half of the year [2] - Analyst Modi adjusted FY25 net sales growth estimates to +9.2%, while organic sales growth is projected at +0.4%, down from +0.7% [3] Group 2 - Analyst Lavery from Piper Sandler reiterated an Overweight rating with a price forecast of $56, citing a cautious outlook on the packaged food category [4] - Lavery forecasts a decline in EPS for the second quarter of 2025 but projects average gains of 7-8% over the next six quarters, lowering FY25 EPS estimate from $3.21 to $3.14 and FY26 EPS from $3.38 to $3.33 [5] - In the second quarter of 2025, sequential improvement in volume and share gains is anticipated [6] Group 3 - Campbell's Company is investing in Rao's innovation and marketing in FY25, focusing on expanding into white sauces for greater production flexibility and potential geographic expansion in Canada [7] - CPB shares are currently trading lower by 0.49% to $42.48 [8]

Group 1 - The Campbell's Company (NASDAQ: CPB) is recommended to hold due to expected lack of upside in stock price [1] - The ideal investment scenario involves core business performance in a sector projected for structural growth exceeding GDP growth over the next 5-10 years [1] - Profits should stem from sustainable competitive advantages that lead to attractive unit economics [1] Group 2 - The company should be managed by competent, ethical, and long-term thinkers [1] - A fair valuation is essential for investment consideration [1]

Group 1 - Campbell's Company (NASDAQ: CPB) has underperformed over the past year, with a gain of only 5% [1] - The company reported disappointing quarterly results, leading to a decline in shares by over 4% [1]

Financial Data and Key Metrics Changes - The company reported a 10% increase in net sales for Q1 2025, driven by the acquisition of Sovos Brands, while organic net sales decreased by 1% due to a dynamic consumer environment and inventory movements related to the Thanksgiving holiday [14][42][44] - Adjusted EBIT grew by 6% year-over-year, and adjusted EPS was $0.89, a decrease of 2% primarily due to higher interest expenses from increased debt levels [15][43][48] - The adjusted gross profit margin declined by 70 basis points, with a 60-basis point impact from the acquisition, while the base business margin decreased by only 10 basis points [45][50] Business Line Data and Key Metrics Changes - In the Meals & Beverages division, organic net sales were flat year-over-year, but pro forma net sales increased by 2% with a 3% growth in volume and mix, driven by the addition of Sovos [23][49] - The Snacks division experienced a 2% decline in organic net sales, impacted by lower sales in partner brands and cookies, with operating earnings declining by 12% due to inflation and supply chain costs [34][51][132] Market Data and Key Metrics Changes - The overall food sector is showing improvement, with consumer confidence stabilizing and food volumes normalizing, benefiting 75% of the company's portfolio which is in growing categories [19][20] - The company noted competitive pressure in certain snack categories from new entrants and a shift towards private label products, but remains confident in its Leadership Brands [22][34] Company Strategy and Development Direction - The company has transformed its portfolio, focusing on 16 Leadership Brands that dominate their categories, and is committed to integrating Sovos Brands effectively to enhance growth [20][30] - The strategy includes a planned reduction in partner brands to concentrate resources on Leadership Brands, which are expected to drive sustainable growth and margin enhancement [34][132] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for future growth, citing strong leadership and a well-aligned team [9][10] - The second quarter is expected to be critical for progress, with anticipated sequential top-line and market share momentum, particularly during the holiday season [17][40] Other Important Information - The company generated $225 million in operating cash flow in Q1, a 29% increase from the previous year, and paid $116 million in dividends [53][55] - A 5% increase in the regular quarterly dividend was announced, reflecting confidence in earnings and long-term growth potential [55][66] Q&A Session Summary Question: Inquiry about gross margin and marketing performance - Management acknowledged that gross margin and marketing expenses were slightly below expectations, attributing this to a mix issue with higher contributions from lower-margin brands like Rao's [71][72][76] Question: Expectations for the back half of the fiscal year - Management indicated that while they do not expect a comprehensive recovery, they anticipate modest improvement in organic growth driven by the integration of Sovos and strong innovation [100][102] Question: Impact of inventory timing shift related to Thanksgiving - Management explained that the later Thanksgiving holiday significantly impacted inventory levels, resulting in a 2-point delta between in-market consumption and net sales [118][120] Question: Concerns about Snacks margins and pricing pressures - Management reassured that their roadmap for cost savings remains intact and they are focused on maintaining margin targets despite current pricing pressures in the salty snacks category [131][132]

The Campbell's Company (CPB) delivered mixed results for the first quarter of fiscal 2025. While the bottom line beat the Zacks Consensus Estimate but declined year over year, the top line missed the consensus mark while increasing from the year-ago period level. That said, organic sales declined. The first-quarter performance reflects the company’s ability to navigate a dynamic consumer landscape and the irregular pace of category recovery. The second quarter, which features the crucial holiday season, is ...

Financial Performance - Net sales increased by 10% year-over-year, reaching $2772 million in Q1 FY25, driven by the acquisition of Sovos Brands[11, 41] - Organic net sales decreased by 1% compared to the previous year[11, 42] - Adjusted EBIT increased by 6% year-over-year[11, 43] - Adjusted EPS decreased by 2% year-over-year to $089[11, 45] - The acquisition of Sovos Brands contributed +12 percentage points to net sales growth, while the divestiture of Pop Secret had a negative impact of -1 percentage point[48] Segment Results - Meals & Beverages net sales increased by 22% to $1706 million, with organic net sales up 0%[65, 66] - Snacks net sales decreased by 4% to $1066 million, with organic net sales down 2%[71, 72] Outlook - The company reaffirmed its FY25 guidance, projecting net sales growth of +9% to +11%[84] - Organic net sales are expected to grow by 0% to +2%[84] - Adjusted EBIT is projected to increase by +9% to +11%[84] - Adjusted EPS is expected to grow by +1% to +4%, reaching $312 to $322[84]