Conagra Brands (CAG) Stock Forecast & Price Target

Conagra Brands is experiencing a positive shift in its market share, with 44% of its portfolio holding or gaining market share, an increase from 39% in the previous quarter, indicating a recovery from prior supply chain challenges. The company's leadership in the single-serve frozen meals sector has strengthened, achieving a market share of 52.9%, reflecting improvements in service and consumer demand. Furthermore, anticipated sales growth in the second half of the fiscal year, supported by innovation and recovery from supply chain issues, contributes to a favorable outlook for the company's financial performance.

Conagra Brands faces significant challenges in maintaining profitability due to modestly higher inflation and the depletion of pre-tariff inventory, leading to expected Q2 operating margins falling below the annual range of 11-11.5%. The company has revised its EPS estimates downward, with projections decreasing to $1.70, primarily driven by lower gross margins and increased advertising and promotional costs in the latter half of the fiscal year. Additionally, the outlook for FY’26 organic sales remains weak, with only a 0.2% growth anticipated, indicating a softer performance in the upcoming quarters.