Hormel Foods Sticks with $12.2–12.5 B Sales Forecast, Cuts EPS to $1.28–1.37
HRL•Hormel Foods projects fiscal‐2026 sales of $12.2–12.5 billion and adjusted EPS of $1.43–1.51 despite 3% Q2 organic growth being pressured by elevated fuel, logistics, pork and beef costs. Reported EPS guidance was reduced to $1.28–1.37 after divesting a whole‐bird turkey unit that trimmed about $50 million in full‐year sales.
1. Q2 Performance and Organic Growth
Hormel Foods delivered 3% organic sales growth in its fiscal Q2 but faced significant headwinds from rising fuel, logistics and commodity costs. Pork and beef expenses remained elevated throughout the quarter, pressuring margin performance despite resilient protein demand.
2. Full-Year Guidance Reaffirmed
The company maintained its full-year sales outlook at $12.2–12.5 billion and reaffirmed adjusted diluted EPS guidance of $1.43–1.51, reflecting 4%–10% growth. Interim management cited underlying momentum and consumer resilience in protein categories as factors supporting the upper half of the earnings range.
3. Cost Headwinds Trigger Reported EPS Cut
Reported diluted EPS guidance was lowered to $1.28–1.37 from $1.37–1.46 due to the February divestiture of its whole‐bird turkey business, which is expected to reduce annual sales by roughly $50 million. Rising fuel costs extended from six weeks to 13 weeks in Q3, intensifying near-term cost pressures.
4. Segment Outlook and Mitigation Plans
Retail sales are forecast to deliver flat to low single-digit growth, foodservice mid-single digits and international high single digits for the year. Management plans inventory adjustments and lower plant utilization in Q3 to enhance operating efficiency and offset ongoing headwinds.
