Conagra Brands, Inc. (NYSE:CAG) shares rose 3.15% in pre-market trading after the company reported first-quarter adjusted earnings above analyst expectations and reaffirmed its fiscal 2027 guidance.
Adjusted earnings per share were $0.41, exceeding the consensus estimate of $0.28 by $0.13.
Revenue totalled $2.6 billion, slightly above the analyst estimate of $2.59 billion, although sales declined 1.4% compared with the prior-year period.
Conagra Reaffirms Fiscal 2027 Guidance
Conagra maintained its fiscal 2027 adjusted earnings guidance of between $1.40 and $1.50 per share.
The midpoint of the range, at $1.45, is slightly above the analyst consensus estimate of $1.44.
The company continues to expect organic net sales to decline between 3% and 1% compared with fiscal 2026.
Conagra also forecasts an adjusted operating margin of between 10.0% and 10.5% for the full year.
Organic Sales Decline 1.1%
First-quarter organic net sales decreased 1.1%, reflecting a 2.1% decline in volume that was partially offset by a 1.0% positive contribution from price and mix.
Conagra said it gained dollar share across several product categories during the quarter, including frozen vegetables, pudding, chilli, frozen breakfast, hot dogs and frozen desserts.
“We delivered a solid start to fiscal 2027 with top line results largely in line with expectations and profit ahead of expectations amid a challenging operating environment,” President and Chief Executive Officer John Brase said.
Adjusted Operating Margin Falls to 11.5%
Conagra reported an adjusted operating margin of 11.5% for the first quarter, down 33 basis points from the prior-year period.
The company benefited from higher productivity and approximately $4 million of tariff refunds during the quarter.
Those benefits were offset by lower organic sales and cost inflation.
The first-quarter adjusted operating margin remained above Conagra’s full-year fiscal 2027 guidance range of 10.0% to 10.5%.
Grocery & Snacks and Refrigerated & Frozen Sales Decline
Organic sales in Conagra’s Grocery & Snacks segment declined 2.0% during the quarter.
The Refrigerated & Frozen segment recorded a 1.6% decline in organic sales.
International organic sales increased 0.9%, while the Foodservice business recorded organic sales growth of 3.3%.
The results reflected differing sales trends across the company’s operating segments, with declines in its Grocery & Snacks and Refrigerated & Frozen businesses and growth in International and Foodservice.
Net Debt Stands at $7.4 Billion
Conagra ended the first quarter with net debt of $7.4 billion.
The company’s net leverage ratio stood at 3.99x at the end of the period.
The balance sheet figures accompanied first-quarter adjusted earnings above analyst expectations and Conagra’s decision to maintain its fiscal 2027 earnings, organic sales and operating margin guidance.
Conagra Brands stock price
