Hormel Foods Readies for Q4 Earnings: Things to Watch for HRL Stock

Core Insights - Hormel Foods Corporation (HRL) is expected to report a revenue increase of 2.1% year-over-year, with fourth-quarter fiscal 2025 revenues estimated at $3.2 billion [1] - The earnings consensus has decreased by 11.8% in the last 30 days to 30 cents per share, reflecting a 28.6% decline from the previous year's quarter [2] Sales Performance - Strong consumer demand for protein-focused retail brands, including SPAM, Hormel pepperoni, Jennie-O ground turkey, and Wholly Guacamole, has supported sales momentum [3] - The Zacks Consensus Estimate for the Retail segment's sales is projected at $1,945 million for the fourth quarter, up from $1,907 million in the same period last year [4] - Foodservice volumes have outperformed the broader industry, although weak traffic in convenience stores poses a concern [4][9] Cost Challenges - Input-cost inflation, particularly in pork and beef markets, has significantly impacted margins, with elevated costs continuing into early fourth quarter [5][9] - Despite targeted pricing actions, retail pricing adjustments are expected to lag, with more substantial recovery anticipated only in fiscal 2026 [6] - The Transform and Modernize initiative is yielding savings, but these are insufficient to fully offset inflationary pressures in the near term, raising profitability concerns [6][9] Earnings Outlook - Current indicators do not suggest a strong likelihood of an earnings beat for Hormel Foods, as it holds a Zacks Rank of 4 (Sell) and an Earnings ESP of 0.00% [7]