Story Stocks^®

Conagra Brands (CAG) is moving higher today after reporting its Q1 (Aug) results this morning. The food giant bounced back nicely to report EPS upside following two consecutive quarters of an EPS miss. Revenue decreased 5.8% yr/yr (-0.6% organically) to $2.63 bln, which was in-line with consensus estimates. The company also reaffirmed FY26 EPS guidance of $1.70-1.85.

• Revenues declined on a 5.1% M&A impact, a 0.6% organic sales decline, and a 0.1% FX headwind. Organic trends improved from -3.5% in Q4, as pricing gains were offset by lower volumes.
• Gross margins are still pressured due to inflation and investments. Adjusted gross margin decreased 153 bps to 24.4%, resulting in a 25.1% decrease in adjusted net income.
• Segment performance was mixed with frozen organic sales up 0.2% (-4.4% in Q4) as volumes improved 0.5% (-2.1% in Q4) and share gains came in meals, vegetables, and chicken.
• Grocery & Snacks organic sales declined 1.0% (-3.3% in Q4) with protein snacks showing strength, but total volumes down 1.6% (flat sequentially).
• Supply chain initiatives supported recovery with service levels restored to 98% and productivity running above plan, aided by tariff mitigation and inventory rebuilds.
• Low-single-digit sales declines expected in Q2, with organic growth expected in the second half as frozen laps supply issues and pricing actions take hold. Total inflation ticked higher to low 7% range.

Briefing.com Analyst Insight

CAG's stock is responding positively as management demonstrated progress on supply chain recovery, frozen momentum, and volume stabilization. The improvement in organic trends versus Q4 and restored service levels are encouraging, but investors will be watching whether these gains can be sustained. Inflation, tariffs, and weak consumer sentiment remain meaningful headwinds, making 2H execution important to building confidence in the long-term recovery story.