General Mills (NYSE:GIS) Issues Quarterly Earnings Results, Beats Expectations By $0.03 EPS

General Mills (NYSE:GIS) released its earnings results on Wednesday. The company reported $0.75 earnings per share for the quarter, beating analysts’ consensus estimates of $0.72 by $0.03, FiscalAI reports. General Mills had a negative net margin of 0.48% and a positive return on equity of 21.37%. The business had revenue of $4.39 billion during the quarter, compared to the consensus estimate of $4.35 billion. During the same quarter in the prior year, the firm posted $0.86 EPS. The company’s revenue for the quarter was down 2.8% compared to the same quarter last year.

Here are the key takeaways from General Mills’ conference call:

• North America retail trends improved sequentially, with dollar sales improving by two points and share performance strengthening in most categories. Management expects further progress from price mix, innovation, renovation, and marketing, although Totino’s and fruit snacks remain areas of concern.
• New product activity is gaining traction, with innovation increasing to 5% of net sales from 3% two years ago. Protein cereals, Totino’s Blasted Rolls, La Tiara, and Love Made Fresh are reportedly seeing strong trial and repeat, while additional pet, snacks, and cereal launches are planned for the second half.
• Input-cost inflation is trending toward the high end of the company’s 4%-5% outlook, with inflation expected near 4% in the first three quarters and around 6% in the fourth quarter. Management said wheat, freight, fuel, fats and oils, and packaging are contributing to pressure, though hedging and cost savings are expected to offset inflation broadly for the full year.
• The pet business continues to face challenges in dry dog food, particularly the Wilderness brand, where declines accelerated and management said the product, packaging, marketing, and communications need to be reassessed. Retailer inventory is still expected to create a low-single-digit headwind for pet sales over the full year.
• General Mills reiterated plans for $750 million of cost savings this fiscal year and $3 billion by fiscal 2030, split between holistic margin management and transformation savings. Net leverage remains just above 4x EBITDA, and management expects it to take at least a couple of years to return to the 3x target.

General Mills Stock Up 0.8%

NYSE GIS opened at $35.73 on Thursday. The business’s fifty day simple moving average is $37.82 and its 200-day simple moving average is $36.40. The company has a quick ratio of 0.40, a current ratio of 0.68 and a debt-to-equity ratio of 1.68. The firm has a market cap of $19.10 billion, a PE ratio of -198.49, a P/E/G ratio of 1.93 and a beta of -0.01. General Mills has a 52 week low of $31.75 and a 52 week high of $51.33.

General Mills Dividend Announcement

The business also recently declared a quarterly dividend, which was paid on Monday, August 3rd. Stockholders of record on Friday, July 10th were issued a dividend of $0.61 per share. This represents a $2.44 annualized dividend and a dividend yield of 6.8%. The ex-dividend date was Friday, July 10th. General Mills’s payout ratio is currently -1,355.56%.

Wall Street Analyst Weigh In

A number of research firms recently issued reports on GIS. Sanford C. Bernstein cut shares of General Mills from a “market perform” rating to an “underperform” rating and set a $31.00 price target on the stock. in a research note on Wednesday, June 3rd. TD Cowen reduced their price target on shares of General Mills from $32.00 to $31.00 and set a “hold” rating for the company in a research report on Thursday, July 2nd. Royal Bank Of Canada reiterated an “outperform” rating and issued a $45.00 price objective on shares of General Mills in a report on Monday. JPMorgan Chase & Co. increased their target price on General Mills from $31.00 to $35.00 and gave the company an “underweight” rating in a report on Thursday, July 2nd. Finally, Jefferies Financial Group set a $35.00 price target on General Mills in a research note on Thursday, September 10th. Four analysts have rated the stock with a Buy rating, ten have assigned a Hold rating and six have given a Sell rating to the stock. According to data from MarketBeat, General Mills currently has a consensus rating of “Reduce” and a consensus target price of $36.41.

Key Stories Impacting General Mills

Here are the key news stories impacting General Mills this week:

• Positive Sentiment: Quarterly results exceeded expectations. Adjusted earnings per share came in at $0.75 versus the $0.72 analyst consensus, while revenue of $4.39 billion topped estimates of $4.35 billion. Demand for pantry staples and breakfast cereals benefited from more consumers eating at home. General Mills beats first-quarter sales estimates
• Positive Sentiment: Full-year guidance was reaffirmed. General Mills continues to expect fiscal 2027 organic sales ranging from a 1.5% decline to 0.5% growth and adjusted diluted EPS of $3.00 to $3.20. Investors may view the maintained outlook as evidence that cost savings and the company’s turnaround initiatives are progressing. International operating profit rose 14%. General Mills Reaffirms Full-Year Guidance
• Neutral Sentiment: The earnings comparison was distorted by last year’s yogurt divestiture. Reported net earnings fell sharply to approximately $397 million, or $0.74 per share, from $1.2 billion, or $2.22 per share, a year earlier, largely because the prior-year period included a substantial gain from the sale of the U.S. yogurt business. Revenue nevertheless declined 2.8% year over year. General Mills Reports Fiscal 2027 First-quarter Results
• Negative Sentiment: Underlying demand remains pressured. North America Retail sales fell about 7%, while organic sales were flat and volumes declined. General Mills warned that inflation could reach roughly 6%, with higher input costs already reducing operating profit; additional price increases remain possible. These factors could limit margin recovery and keep pressure on future sales. General Mills Warns Inflation Could Hit 6%

About General Mills

General Mills, Inc is a global food company that manufactures and markets branded consumer food products. Its portfolio includes cereals, snacks, refrigerated and shelf-stable meals, baking products, yogurt, and pet food.

The company’s brands include Cheerios, Betty Crocker, Pillsbury, Nature Valley, Old El Paso, Yoplait, Blue Buffalo, and Häagen-Dazs in markets where it owns or licenses the brand. General Mills sells its products through grocery stores, mass merchants, convenience stores, e-commerce channels, restaurants, and other foodservice providers.

General Mills traces its history to the Minneapolis Milling Company, founded in 1856, and adopted the General Mills name in 1928.