Hormel Foods (HRL) Stock Forecast & Price Target

Hormel Foods has successfully diversified its product lineup beyond traditional meat offerings, establishing itself as a prominent branded food company with major brands capturing significant market shares in their categories. The firm derives a substantial portion of its revenue from various channels, with 62% coming from U.S. retail and 32% from U.S. food service, reflecting a robust position in the domestic market. Furthermore, rising cutout values, which averaged $96.12 per hundredweight in F2Q25, and a 6.5% year-over-year increase in hog prices, indicate strong pricing power and market demand, supportive of a positive outlook for the company’s financial performance.

Hormel Foods has lowered its earnings per share (EPS) estimate from $0.35 to $0.34 due to observed weaknesses reflected in scanner data. Additionally, the company's market hog inventory has seen a year-over-year decline of 0.2% and a sequential decrease of 1.9%, indicating potential challenges in meat supply. Furthermore, farrowing intentions for the Mar-May period have also fallen below analyst expectations, suggesting a contraction in future production capabilities.