Dj General Mills Inc. Stock Underperforms Tuesday When Compared To Competitors Despite Daily Gains

Valued at a market cap of $38.1 billion, General Mills, Inc. manufactures and markets branded consumer foods sold through retail stores. The Minnesota-based company’s principal product categories include ready-to-eat cereals, convenient meals, snacks, yogurt, super-premium ice creams, baking mixes, and ingredients. It is expected to announce its fiscal Q2 earnings results on Wednesday, Dec. 18.

Ahead of this event, analysts expect the packaged food company to report a profit of $1.22 per share, down 2.4% from $1.25 per share in the year-ago quarter. The company has consistently beaten Wall Street's earnings estimates in each of the last four quarters. In Q1 2025, the company’s adjusted EPS of $1.07 outpaced the consensus estimates by 1.9% but fell 2% on a constant currency basis. The decline in the bottom line was due to the company’s higher expenses and lower margins, primarily driven by input cost inflation and increased SG&A expenses.

For fiscal 2025, analysts expect GIS to report an EPS of $4.51, slightly down from $4.52 in fiscal 2024. Nonetheless, EPS is expected to grow 3.1% year-over-year to $4.65 in fiscal 2026.

Shares of GIS have surged nearly 4.9% on a YTD basis, lagging behind both the S&P 500 Index's ($SPX) 21.8% rise and the Consumer Staples Select Sector SPDR Fund’s (XLP) 12.5% return over the same period.

GIS has underperformed due to increasing competition in the industry coupled with broader economic headwinds like inflation and consumer shift to more value-conscious products, leading to the company’s soft volume trends and increasing pricing pressure.

However, on Sep. 18, shares of GIS increased marginally after its better-than-expected Q1 earnings release. Along with its adjusted earnings, its revenue of $4.85 billion surpassed the Wall Street estimates of $4.78 billion but fell 1% on a yearly basis. The fall in revenue was primarily driven by unfavorable organic net price realization and mix.

Analysts' consensus view on General Mills’ stock is cautiously optimistic, with a "Moderate Buy" rating overall. Among 18 analysts covering the stock, four recommend a "Strong Buy," and 14 suggest a "Hold." This configuration is more bullish than three months ago, with three analysts suggesting a "Strong Buy."

The average analyst price target for GIS is $74.39, indicating an 8.9% potential upside from the current levels.

On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.