Conagra Brands (NYSE:CAG) saw its shares jump 5% at the market open on Thursday after the company delivered better-than-anticipated earnings and revenue for the fiscal Q3 2024.
The food company reported earnings per share (EPS) of $0.69, topping the consensus estimates of $0.64. Revenue for the quarter came in at $3.03 billion, also above the anticipated $3.01 billion.
The adjusted operating margin for the quarter was recorded at 16.4%, a slight decrease from the previous year's 16.9% but above the projected 15.7%.
Looking ahead, Conagra forecasts its full-year 2024 EPS to be in the range of $2.60 to $2.65, compared with analysts’ estimates of $2.60.
Further, the owner of Birds Eye and Duncan Hines hiked its adjusted operating margin guidance for the fiscal 2024, now projecting 15.8%.
It has also provided updates for 2024 on several financial metrics, now anticipating a net leverage ratio of about 3.44 times, capital expenditures to be around $425 million, and interest expenses estimated to be approximately $435 million.
Conagra has reiterated its 2024 forecast for adjusted EPS in the range of $2.60 to $2.65 and projecting a 1-2% decline in organic net sales.
Stifel analysts reiterated a Hold rating and a target price on CAG following the report’s release.
“We continue with our Hold rating and $29 target price, reflecting a 9.0x EV/EBITDA multiple on our CY24 estimate, placing the shares at a 20% discount to its domestic large-cap packaged foods peers,” they wrote.