Adversity is less terrifying than hope: Conagra Brands Inc. (CAG)

Conagra Brands Inc. (NYSE: CAG) stock jumped 1.28% on Friday to $34.76 against a previous-day closing price of $34.32. With 2.79 million shares changed hands, the volume of the stock remained lighter than its average volume of 3.49 million shares. During the session, the Packaged Foods company that operates in wider Consumer Defensive sector, reached to the highest price of $34.97 whereas the lowest price it dropped to was $34.31. The 52-week range on CAG shows that it touched its highest point at $36.97 and its lowest point at $30.06 during that stretch. It currently has a 1-year price target of $36.03. With its current market cap of 16.60 billion, CAG has annualized dividend of $1.32 while the current yield stands at 3.80%. Beta for the stock currently stands at 0.57.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of CAG was up-trending over the past week, with a rise of 3.39%, but this was down by -1.22% over a month. Three-month performance surged to 4.35% while six-month performance rose 8.15%. The stock gained 4.38% in the past year, while it has gained 1.79% so far this year. A look at the trailing 12-month EPS for CAG yields 1.84 with Next year EPS estimates of 2.59. For the next quarter, that number is 0.51. This implies an EPS growth rate of -30.80% for this year and 7.42% for next year. EPS is expected to grow by 3.46% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 8.40%.

Float and Shares Shorts:

At present, 480.30 million CAG shares are outstanding with a float of 478.41 million shares on hand for trading. On Jul 14, 2022, short shares totaled 10.72 million, which was 2.23% higher than short shares on Jun 14, 2022. In addition to Mr. Sean M. Connolly as the firm’s Pres, CEO & Director, Mr. David S. Marberger serves as its Exec. VP & CFO.


Institutional Ownership:

Through their ownership of 83.91% of CAG’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 51.72% of CAG, in contrast to 5.37% held by mutual funds. Shares owned by individuals account for 33.71%. As the largest shareholder in CAG with 11.20% of the stake, The Vanguard Group, Inc. holds 53,831,651 shares worth 53,831,651. A second-largest stockholder of CAG, BlackRock Fund Advisors, holds 31,727,025 shares, controlling over 6.60% of the firm’s shares. T. Rowe Price Associates, Inc. is the third largest shareholder in CAG, holding 27,918,907 shares or 5.81% stake. With a 2.96% stake in CAG, the Vanguard Total Stock Market Index is the largest stakeholder. A total of 14,206,244 shares are owned by the mutual fund manager. The Vanguard Mid Cap Index Fund, which owns about 2.29% of CAG stock, is the second-largest Mutual Fund holder. It holds 11,017,928 shares valued at 378.8 million. Vanguard 500 Index Fund holds 2.23% of the stake in CAG, owning 10,704,414 shares worth 368.02 million.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for CAG since 17 analysts follow the stock currently. There are 2 analysts who recommend BUY ratings, while 0 suggest SELL ratings. Of the remaining analysts, 12 believe that the stock is worth HOLDING, 3 give it an OVERWEIGHT rating, and 0 thinks that it’s UNDERWEIGHT. In the same way, a target price assigned to a stock can also reveal much about its potential. With CAG analysts setting a high price target of $40.00 and a low target of $32.00, the average target price over the next 12 months is $36.03. Based on these targets, CAG could surge 15.07% to reach the target high and fall by -7.94% to reach the target low. Reaching the average price target will result in a growth of 3.65% from current levels.


EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy. CAG will report FY 2023 earnings on 07/13/2023. Analysts have provided yearly estimates in a range of $2.45 being high and $2.38 being low. For CAG, this leads to a yearly average estimate of $2.41. The earnings surprise of a firm occurs when the actual results change from the consensus earnings estimate. Conagra Brands Inc. surprised analysts by $0.02 when it reported $0.65 EPS against a consensus estimate of $0.63. The surprise factor in the prior quarter was $0.00. Based on analyst estimates, the high estimate for the next quarter is $0.56 and the low estimate is $0.44. The average estimate for the next quarter is thus $0.51.

Summary of Insider Activity:

Insiders traded CAG stock several times over the past three months with 11 Buys and 9 Sells. In these transactions, 189,379 shares were bought while 78,382 shares were sold. The number of buy transactions has increased to 34 while that of sell transactions has risen to 15 over the past year. The total number of shares bought during that period was 442,822 while 278,764 shares were sold.

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