Core Insights - Conagra Brands, Inc. reported first-quarter fiscal 2026 results with both revenue and earnings exceeding Zacks Consensus Estimates, although both metrics showed a year-over-year decline [1][12] Financial Performance - Adjusted earnings per share (EPS) were 39 cents, surpassing the Zacks Consensus Estimate of 33 cents, but reflecting a 26.4% decline year over year [2] - Net sales totaled $2,632.6 million, down 5.8% year over year, yet exceeding the Zacks Consensus Estimate of $2,609 million [3] - Organic net sales decreased by 0.6%, with a 0.6% positive impact from price/mix offset by a 1.2% decline in volume [4] Profitability Metrics - Adjusted gross profit fell 11.3% to $644 million, with adjusted gross margin contracting 153 basis points to 24.4% [5] - Adjusted EBITDA was $441 million, down 16.4% year over year [6] Segment Performance - Grocery & Snacks segment reported net sales of $1,079.6 million, down 8.7% year over year, driven by a 7.7% adverse impact from M&A [7] - Refrigerated & Frozen segment saw net sales decrease by 0.9% year over year to $1,076.2 million, reflecting a 1.1% headwind from M&A [8] - International segment's net sales declined 18% year over year to $212.3 million, missing estimates due to a 13.2% unfavorable impact from M&A [9] - Foodservice segment reported sales of $264.5 million, down 0.8% year over year, with a 1.0% headwind from M&A [10] Financial Health - The company ended the quarter with cash and cash equivalents of $698.1 million and long-term debt of $7,222.6 million [13] - For fiscal 2026, Conagra projects EPS between $1.70 and $1.85 and organic growth between -1% and 1% [12][15] Dividend Declaration - Conagra declared a quarterly dividend of 35 cents per share, payable on November 26, 2025 [14]

Core Insights - Conagra Brands reported a double beat in its fiscal first quarter of 2026, leading to a share price increase of over 5%, outperforming the S&P 500's 0.3% rise [1] Financial Performance - Conagra's net sales decreased by nearly 6% year over year to $2.63 billion, attributed mainly to merger and acquisition activities, but slightly exceeded the average analyst estimate of $2.62 billion [2] - Non-GAAP adjusted net income fell by 25% to $189 million ($0.39 per share), influenced by the sales decline and loss of profits from divested businesses, yet surpassed the consensus projection of $0.33 per share [3] Strategic Actions - The company has been actively divesting assets, including the sale of the Chef Boyardee brand and other prepared food brands to different companies [4] Future Guidance - Conagra maintained its full-year guidance for fiscal 2026, expecting organic net sales growth to decline by 1% to increase by 1% compared to 2025, with adjusted earnings per share projected between $1.70 and $1.85 [5]

PART I [ITEM 1. FINANCIAL STATEMENTS](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) Presents Conagra Brands' unaudited Q1 FY26 and Q1 FY25 consolidated financial statements and detailed notes [Unaudited Condensed Consolidated Statements of Earnings](index=3&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Earnings) | Metric (in millions) | Thirteen Weeks Ended August 24, 2025 | Thirteen Weeks Ended August 25, 2024 | Change (%) | | :------------------- | :----------------------------------- | :----------------------------------- | :--------- | | Net sales | $2,632.6 | $2,794.9 | (5.8%) | | Gross profit | $640.6 | $739.3 | (13.4%) | | Operating profit | $347.4 | $401.6 | (13.5%) | | Net income | $164.5 | $466.9 | (64.8%) | | Diluted EPS | $0.34 | $0.97 | (64.9%) | [Unaudited Condensed Consolidated Statements of Comprehensive Income](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This section details Conagra Brands' comprehensive income, including net income and other comprehensive income components | Metric (in millions) | Thirteen Weeks Ended August 24, 2025 | Thirteen Weeks Ended August 25, 2024 | Change (%) | | :------------------- | :----------------------------------- | :----------------------------------- | :--------- | | Net income | $164.5 | $466.9 | (64.8%) | | Comprehensive income | $164.9 | $524.3 | (68.6%) | - Unrealized currency translation gains shifted from a loss of **$19.3 million** in Q1 FY25 to a gain of **$1.1 million** in Q1 FY26[11](index=11&type=chunk) [Unaudited Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This section presents Conagra Brands' financial position, including assets, liabilities, and equity, as of August 24, 2025, and May 25, 2025 | Metric (in millions) | August 24, 2025 | May 25, 2025 | Change (%) | | :------------------- | :-------------- | :----------- | :--------- | | Cash and cash equivalents | $698.1 | $68.0 | 926.6% | | Inventories | $2,258.2 | $2,048.3 | 10.2% | | Total current assets | $3,840.1 | $3,071.0 | 24.9% | | Total assets | $21,172.8 | $20,933.9 | 1.1% | | Total current liabilities | $3,629.6 | $4,317.0 | (15.9%) | | Senior long-term debt | $7,222.6 | $6,234.1 | 15.9% | | Total liabilities | $12,257.0 | $12,001.2 | 2.1% | | Total stockholders' equity | $8,915.8 | $8,932.7 | (0.2%) | [Unaudited Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section outlines Conagra Brands' cash inflows and outflows from operating, investing, and financing activities for Q1 FY26 and Q1 FY25 | Metric (in millions) | Thirteen Weeks Ended August 24, 2025 | Thirteen Weeks Ended August 25, 2024 | Change (%) | | :------------------- | :----------------------------------- | :----------------------------------- | :--------- | | Net cash flows from operating activities | $120.6 | $268.6 | (55.1%) | | Net cash flows from investing activities | $502.0 | $(286.3) | 275.3% | | Net cash flows from financing activities | $7.2 | $70.1 | (89.7%) | | Net change in cash and cash equivalents | $630.1 | $51.0 | 1135.5% | [Notes to Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the unaudited condensed consolidated financial statements [1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES](index=8&type=section&id=1.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) The Company's financial statements are prepared in accordance with U.S. GAAP, with no significant changes to accounting policies from the prior fiscal year - No significant changes to accounting policies from the prior fiscal year were reported[18](index=18&type=chunk) - The FASB issued **ASU 2023-09** (Improvements to Income Tax Disclosures), **ASU 2024-03** (Disaggregation of Income Statement Expenses), and **ASU 2025-06** (Intangibles – Goodwill and Other – Internal-Use Software), which the Company is analyzing for impact and plans to adopt in fiscal **2026**, **2027**, and **2028**, respectively[19](index=19&type=chunk)[20](index=20&type=chunk)[21](index=21&type=chunk) [2. ACQUISITIONS](index=8&type=section&id=2.%20ACQUISITIONS) In Q1 FY25, Conagra Brands completed two acquisitions: a contract manufacturer and Sweetwood Smoke & Co., resulting in significant goodwill allocations - In July 2024, Conagra acquired the manufacturing operations of an existing contract manufacturer for **$51.2 million**, with approximately **$46.3 million** classified as goodwill[22](index=22&type=chunk) - In August 2024, the Company acquired Sweetwood Smoke & Co. for **$179.4 million**, allocating approximately **$130.0 million** to goodwill and **$61.3 million** to intangible assets[23](index=23&type=chunk) - Goodwill from these acquisitions is primarily attributable to anticipated synergies, future growth opportunities, and other non-separately recognized intangibles, with results included in the Grocery & Snacks segment[24](index=24&type=chunk)[25](index=25&type=chunk) [3. DIVESTITURES AND ASSETS HELD FOR SALE](index=10&type=section&id=3.%20DIVESTITURES%20AND%20ASSETS%20HELD%20FOR%20SALE) Conagra Brands completed the sale of its Chef Boyardee® business and frozen fish business in Q1 FY26, recognizing a net gain on divestitures - Completed the sale of Chef Boyardee® business for net proceeds of **$601.2 million**, recognizing a gain of **$42.8 million**[26](index=26&type=chunk) - Completed the sale of the frozen fish business (Van De Kamp's® and Mrs. Paul's® brands) for net proceeds of **$42.4 million**, recognizing a loss of **$0.4 million**[28](index=28&type=chunk) - In Q1 FY25, sold **51.8%** ownership in Agro Tech Foods Limited (ATFL) for **$76.8 million**, recognizing a loss of **$2.3 million** and releasing **$79.8 million** in currency translation losses[30](index=30&type=chunk) [4. RESTRUCTURING ACTIVITIES](index=12&type=section&id=4.%20RESTRUCTURING%20ACTIVITIES) Conagra Brands continued its restructuring plan to improve SG&A effectiveness and supply chain optimization, recognizing **$4.4 million** in charges during Q1 FY26 - The Conagra Restructuring Plan, aimed at improving SG&A effectiveness and supply chain optimization, has approved **$349.0 million** in costs since fiscal 2019, with **$325.6 million** recognized cumulatively[34](index=34&type=chunk) | Expense Category (in millions) | Q1 Fiscal 2026 Charges | | :----------------------------- | :--------------------- | | Total cost of goods sold | $0.7 | | Total SG&A | $3.7 | | **Total** | **$4.4** | - As of August 24, 2025, the balance of liabilities recorded for the restructuring plan was **$13.8 million**[36](index=36&type=chunk) [5. DEBT AND REVOLVING CREDIT FACILITY](index=12&type=section&id=5.%20DEBT%20AND%20REVOLVING%20CREDIT%20FACILITY) In Q1 FY26, Conagra issued **$1.0 billion** in senior unsecured notes and prepaid **$500 million** in term loans, reducing net interest expense - Issued **$500.0 million** of **5.00%** senior unsecured notes due August 1, 2030, and **$500.0 million** of **5.75%** senior unsecured notes due August 1, 2035[37](index=37&type=chunk) - Prepaid **$500.0 million** in aggregate principal amount of unsecured term loans using divestiture proceeds and new note issuances[38](index=38&type=chunk)[39](index=39&type=chunk) | Metric (in millions) | Thirteen Weeks Ended August 24, 2025 | Thirteen Weeks Ended August 25, 2024 | Change (%) | | :------------------- | :----------------------------------- | :----------------------------------- | :--------- | | Net interest expense | $93.8 | $105.8 | (11.4%) | [6. FINANCING ARRANGEMENTS](index=14&type=section&id=6.%20FINANCING%20ARRANGEMENTS)

Core Insights - Conagra Brands Inc. shares increased by approximately 2% following the release of first-quarter fiscal 2026 results that surpassed earnings expectations despite inflationary pressures and cautious consumer spending [1] Financial Performance - The company reported adjusted earnings of $0.39 per share for the quarter ending August 24, exceeding the analyst consensus of $0.33 [2] - Revenue for the quarter was $2.63 billion, slightly above estimates of $2.62 billion, but down 5.8% compared to the previous year; organic net sales decreased by 0.6% [2] Future Outlook - Conagra reaffirmed its fiscal 2026 outlook, projecting organic net sales growth between -1% and +1%, adjusted operating margin of 11.0% to 11.5%, and adjusted EPS between $1.70 and $1.85, aligning with the analyst consensus of $1.78 [3]

Core Viewpoint - Conagra Brands is presenting its First Quarter Fiscal 2026 Earnings, indicating a focus on financial performance and future outlook [1][2]. Group 1: Earnings Presentation - The earnings call is led by key executives including the CEO and CFO, highlighting the importance of leadership in communicating financial results [2][3]. - A live question-and-answer session will follow the prepared remarks, allowing for direct engagement with investors [1]. Group 2: Forward-Looking Statements - The company will make forward-looking statements based on current information, emphasizing the uncertainty and potential variability in achieving projected results [2]. - Risk factors associated with these forward-looking statements are detailed in the company's SEC filings, indicating a commitment to transparency [2]. Group 3: Financial Measures - The discussion will include non-GAAP financial measures, with reconciliations provided in the earnings release and presentation materials, ensuring clarity in financial reporting [3].

Core Insights - Conagra Brands, Inc. (NYSE:CAG) is experiencing challenges due to commodity inflation, particularly in beef, leading to a downward revision of its FY2026 EPS from $1.82 to $1.79, reflecting a 22% year-over-year decline [1][2] - Evercore ISI has reiterated an In Line rating on Conagra while reducing the price target from $24 to $23, which represents a valuation of 12 times the projected 2027 EPS [1][3] Financial Performance - The FY2026 EPS revision indicates a significant decrease, with the new estimate at $1.79 compared to the previous $1.82 [1] - The price target reduction to $23 suggests a slight discount compared to Conagra's five-year average PE ratio of 13x, which has fluctuated between 10x and 16x [3] Market Position and Strategy - Conagra is navigating a year of change, facing rising expenses, potential tariffs, impacts from divesting brands, and investments in pricing and promotional strategies [2] - The company is expected to focus on regaining organic sales growth, particularly in the Frozen and Snacks segments, which account for approximately two-thirds of total sales [3] Company Overview - Conagra Brands operates in the packaged consumer products sector with four main segments: Grocery & Snacks, Refrigerated & Frozen, International, and Foodservice [4]

Group 1 - Conagra Brands, Inc. is recognized as one of the 10 highest dividend-paying stocks in the S&P 500, appealing to income-focused investors [1] - The company operates in the packaged foods sector, offering products under well-known brands such as Hunt's, Orville Redenbacher's, and Slim Jim [2] - Conagra has faced challenges with declining revenue over the past two fiscal years, leading to analysts reducing their stock targets following disappointing revenue and earnings results [3] Group 2 - Despite recent struggles, Conagra has a strong dividend history, having paid quarterly dividends since January 1976, with a current payout of $0.35 per share [4] - The stock boasts a dividend yield of 7.70% as of September 27, making it attractive for income investors [4] - The company's fiscal 2026 guidance indicates expectations for flat organic sales and profits that may fall short of market expectations, with a projected payout ratio of 79% [3]

Core Insights - Conagra Brands, Inc. reported earnings per share of $0.39, exceeding the estimated $0.33, with revenue of approximately $2.63 billion, surpassing the estimated $2.62 billion [1][3] Financial Performance - The company achieved a 5.8% decrease in net sales but managed to surpass Wall Street's expectations for first-quarter sales due to strong demand for pantry staples [2][4] - Conagra's price-to-earnings (P/E) ratio is 7.60, indicating a relatively low valuation compared to its earnings, while the price-to-sales ratio is 0.75 [4] - The enterprise value to sales ratio is 1.46, and the enterprise value to operating cash flow ratio is 10.05, reflecting the company's valuation relative to its sales and operating cash flow [5] Strategic Execution - Conagra has made progress in top-line performance and strategic execution, achieving key supply chain objectives and reducing net debt [2][4] - CEO Sean Connolly emphasized disciplined execution and balanced capital allocation as key factors in the company's performance [4] Market Position - Conagra is a significant player in the packaged foods industry, competing with major companies like General Mills and Kraft Heinz [3]

Core Insights - Conagra Brands Inc. reported first-quarter fiscal 2026 results that exceeded Wall Street expectations but showed year-over-year declines in key metrics [1][2] Financial Performance - The company achieved net sales of $2.63 billion, a decrease of 5.8% compared to the prior-year period, while adjusted earnings per share were 39 cents, down 26.4% [2] - Wall Street analysts had anticipated net sales of $2.62 billion and earnings of 33 cents per share [3] Sales Breakdown - The decline in net sales was attributed to a 5.1% impact from mergers and acquisitions, a 0.6% drop in organic sales, and a minor 0.1% foreign exchange effect [3] - Within organic sales, a 0.6% price/mix benefit was more than offset by a 1.2% decline in volume [4] Segment Performance - Grocery & Snacks revenue fell 8.7% to $1.1 billion, with a 1.0% decline in organic net sales [6] - Refrigerated & Frozen sales decreased 0.9% to $1.1 billion, but organic net sales rose 0.2% due to a 0.5% increase in volume [6] - International segment revenue declined 18% to $212 million, with organic net sales down 3.5% [7] - Foodservice sales dipped 0.8% to $264 million, while organic net sales rose 0.2% [7] Cash Position - Conagra reported cash and cash equivalents of $698.1 million at the end of the first quarter of fiscal 2026 [4] Management Commentary - The CEO highlighted successful supply chain objectives and a focus on disciplined execution amid ongoing inflationary pressures and cautious consumer sentiment [5] Outlook - For fiscal 2026, the company reaffirmed guidance, projecting organic net sales growth between -1% and 1%, an adjusted operating margin of 11.0%–11.5%, and adjusted EPS of $1.70–$1.85 [8]

Core Insights - Conagra Brands reported revenue of $2.63 billion for the quarter ended August 2025, a decrease of 5.8% year-over-year, with EPS at $0.39 compared to $0.53 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $2.61 billion by 0.89%, while the EPS surpassed the consensus estimate of $0.33 by 18.18% [1] Financial Performance Metrics - Net Sales growth in Grocery & Snacks was -8.7%, better than the average estimate of -10.1% [4] - Net Sales growth in Refrigerated & Frozen was -0.9%, compared to the average estimate of -3.6% [4] - Price/Mix for Foodservice increased by 3.8%, exceeding the average estimate of 2% [4] - Organic Volume for Foodservice decreased by -3.6%, slightly worse than the average estimate of -3.3% [4] - Price/Mix for International was 1.7%, below the average estimate of 3.1% [4] - Organic Volume for International declined by -5.2%, worse than the average estimate of -2.9% [4] - Net Sales growth for International was -18%, significantly worse than the average estimate of -9.7% [4] - Net Sales growth for Foodservice was -0.8%, better than the average estimate of -1.3% [4] Sales Breakdown - Sales in Grocery & Snacks amounted to $1.08 billion, slightly above the average estimate of $1.06 billion, reflecting a year-over-year decline of -8.7% [4] - Sales in Foodservice were $264.5 million, exceeding the average estimate of $263.17 million, with a year-over-year change of -0.8% [4] - Sales in International reached $212.3 million, below the average estimate of $238.18 million, representing a year-over-year decline of -18.1% [4] - Sales in Refrigerated & Frozen were $1.08 billion, surpassing the average estimate of $1.05 billion, with a year-over-year change of -0.9% [4]