What Happened?

Shares of packaged foods company Conagra Brands (NYSE:CAG) fell 10.1% in the morning session after the company reported third-quarter (fiscal Q1 2025) earnings results. Its organic revenue and EPS missed Wall Street's estimates. While the top line reflected weaker pricing and volumes, management added that sales were also negatively impacted by "approximately $27 million due to temporary manufacturing disruptions in the Hebrew National business during the key grilling season." Overall, this quarter could have been better.

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What The Market Is Telling Us

Conagra’s shares are not very volatile and have only had a move greater than 5% over the last year. Moves this big are rare for Conagra and indicate this news significantly impacted the market’s perception of the business.

The biggest move we wrote about over the last year was 6 months ago when the stock gained 6.6% on the news that the company reported impressive first-quarter results, which beat analysts' organic revenue growth expectations. Its gross margin also outperformed Wall Street's estimates. For the full year, it was comforting that organic sales guidance was maintained while operating margin guidance was raised. The CEO struck an optimistic tone in the release, saying that "Volume trends in our domestic retail business continued to improve as targeted investments, particularly in frozen, generated strong lifts and unit share gains." Overall, this quarter's results seemed fairly positive, and shareholders should feel optimistic.

Conagra is up 1.7% since the beginning of the year, and at $30.02 per share, it is trading close to its 52-week high of $32.83 from September 2024. Investors who bought $1,000 worth of Conagra’s shares 5 years ago would now be looking at an investment worth $1,060.

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