What's Cooking for Conagra Stock Ahead of Q1 Earnings Release?

Conagra Brands, Inc. CAG is likely to witness a top and bottom-line decline when it reports first-quarter fiscal 2026 earnings on Oct. 1. The Zacks Consensus Estimate for revenues is pegged at $2.61 billion, indicating a 6.5% drop from the prior-year quarter’s reported figure. 

The consensus mark for earnings has declined by a penny in the past 30 days to 33 cents per share, which suggests a 37.7% decrease from the figure reported in the year-ago quarter. CAG has a negative trailing four-quarter earnings surprise of 3.6%, on average.

CAG: Key Factors to Watch

Conagra Brands ended fiscal 2025 with notable challenges, including persistent inflation, foreign exchange headwinds and supply constraints, all of which weighed on results and created a difficult start for fiscal 2026. These issues are likely to have carried over into the first quarter, raising concerns over revenues and earnings. Our model suggests a 1.8% dip in organic revenues for the quarter under review. 

Conagra has been encountering elevated costs across raw materials, packaging, labor and logistics, especially from proteins like beef and poultry, as well as inputs such as tinplate steel due to tariffs. Increased investments in promotions and merchandising to lift volumes could have also pressured margins in the first quarter, particularly as consumer demand has softened in some categories. We expect a 300-basis-point contraction in the adjusted gross margin for the quarter to be reported. 

Volatile currency movements may also drag the International segment’s results. This, along with volume softness and competitive pressures, could have dampened overall revenue momentum. Our model suggests a 7.6% decline in the International segment’s sales for the first quarter. 

Innovation and brand support remain Conagra Brands’ strengths, particularly in frozen meals and snacks, where the company continues to see positive consumer response. CAG’s ongoing productivity programs and cost savings initiatives are also breathers.

Earnings Whispers for CAG Stock

Our proven model doesn’t conclusively predict an earnings beat for Conagra Brands this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here. 

Conagra Brands carries a Zacks Rank #4 (Sell) and has an Earnings ESP of +6.95%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings this reporting cycle.

The Chef's Warehouse CHEF currently has an Earnings ESP of +7.32% and a Zacks Rank of 1. The company is likely to register a jump in the top and bottom lines when it reports third-quarter 2025 numbers. The Zacks Consensus Estimate for The Chef's Warehouse’s quarterly revenues is pegged at $981.3 million, which suggests an increase of 5.4% from the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for quarterly earnings per share stands at 41 cents, up 13.9% from the year-ago period. CHEF has a trailing four-quarter earnings surprise of 11.3%, on average.

Kraft Heinz Company KHC currently has an Earnings ESP of +0.44% and a Zacks Rank of 3. The company is likely to register a top and bottom-line decrease when it reports third-quarter 2025 numbers. The Zacks Consensus Estimate for Kraft Heinz’s quarterly revenues is pegged at $6.27 billion, which calls for a decrease of 1.7% from the prior-year quarter.

The Zacks Consensus Estimate for Kraft Heinz’s quarterly earnings per share is pegged at 58 cents, indicating a 22.7% plunge from the year-ago period. KHC has a trailing four-quarter earnings surprise of 5.1%, on average.

Kimberly-Clark Corporation KMB currently has an Earnings ESP of +17.43% and a Zacks Rank of 3. The company is likely to register top and bottom-line declines when it reports third-quarter 2025 numbers. The Zacks Consensus Estimate for Kimberly-Clark’s quarterly revenues is pegged at $4.17 billion, which suggests a 15.9% plunge from the prior-year quarter. 

The Zacks Consensus Estimate for Kimberly-Clark’s quarterly earnings per share is pegged at $1.64, indicating a 10.4% fall from the year-ago period figure. KMB has a trailing four-quarter earnings surprise of 6.2%, on average.

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This article originally published on Zacks Investment Research (zacks.com).

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