• Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
Stock

Big Food’s big challenge of keeping up with evolving consumer diets has Wall Street wary

by March 2, 2025
by March 2, 2025

Major food manufacturers, including JM Smucker, Mondelez International, Hershey, and PepsiCo, have faced declines in stock performance over the past year, raising concerns about the long-term viability of their business models.

Inflation remains a key challenge, with rising prices straining consumer budgets and leading to a sharp drop in consumer confidence, according to data from the Conference Board.

Meanwhile, Wall Street analysts are increasingly wary of trade wars and their potential impact on global supply chains.

One of the biggest concerns for packaged food makers is the rise of weight-loss drugs such as GLP-1 agonists, according to a report by Barron’s.

As more consumers turn to these medications, the traditional “snackification” of eating habits may be under threat.

Yet, companies such as McCormick have managed to buck the trend, with the spice maker’s stock up 20% over the past year.

“We do not compete for calories; we flavour them,” McCormick’s CEO noted in a recent earnings report, highlighting the strength of seasonings, condiments, and hot sauces.

Trends and buzzwords: what analysts took away from CAGNY

Analysts at JPM observed that the snack sector has been in a “deep slump for over a year.”

General Mills, for example, barely mentioned its snack brands, while Conagra was more vocal about the category at this year’s Consumer Analysts Group of New York (CAGNY) held in Florida.

The company noted that snacking occasions are increasing, particularly among children and teenagers, but that consumer preferences are shifting toward meat snacks and nuts rather than traditional chips and cookies.

Innovation in an era of changing consumer needs

According to the report, innovation remains a crucial growth driver, though it took a backseat during the pandemic due to supply chain disruptions.

Now, companies are reintroducing new products, some of which stretch conventional food categories.

JM Smucker, for instance, unveiled Milk-Bone Peanut Buttery Bites, a dog treat made with real Jif peanut butter, describing it as the “first dog treat featuring a human food brand.”

Meanwhile, Conagra is adapting to the rise of weight-loss drugs by labeling certain Healthy Choice meals as “GLP-1 friendly,” catering to consumers seeking portion-controlled options.

However, not all innovations inspire confidence—its new frozen Vlasic Big Crunch! Crispy Fried Pickles have been met with skepticism.

The debate over “peak protein” and food branding

Analysts at Bank of America have raised concerns about “peak protein,” referring not just to market saturation but also the increasingly bold marketing of protein content on food packaging.

General Mills, for example, has emphasized high protein content on its Progresso soup cans and Strawberry Cheerios Protein boxes, often overshadowing the actual brand names.

WK Kellogg, following its 2023 split from Kellanova, is also seeking to diversify beyond cereal, discussing potential acquisitions to fuel growth.

However, this raises questions about whether the company is staying true to its core identity, as its 2023 investor presentation emphasized that “everything we do will be in service of cereal.”

Can Big Food regain its footing? Analysts weigh in

The challenges facing packaged food companies have led to increased scrutiny of their financial performance.

Wall Street has traditionally viewed consumer staples as a stable investment, offering consistent revenue growth and dividends.

However, analysts warn that companies such as General Mills and Kraft Heinz may struggle to meet growth expectations in the near term.

Bank of America has warned that General Mills could underperform its “algorithmic” growth targets through 2025, while Kraft Heinz may not see meaningful earnings growth until 2027.

Hershey, grappling with soaring cocoa prices, may only return to “on-algorithm” growth by next year.

Oppenheimer has summed up the industry’s outlook by citing inflation, pricing constraints, obesity drugs, tariff risks, and competition from private-label brands as significant hurdles.

“A difficult backdrop is likely to continue,” it says.

Investors should take note as speculation grows about a US market shift toward value stocks, including consumer staples.

The challenge is that the cheaper options lack growth potential, while those with growth prospects come at a premium.

General Mills, trading at 14 times earnings, is expected to see a slight earnings decline for its fiscal year ending in May, while McCormick, with mid-single-digit growth, commands a steep 25 times earnings.

The post Big Food’s big challenge of keeping up with evolving consumer diets has Wall Street wary appeared first on Invezz

0 comment
0
FacebookTwitterPinterestEmail

previous post
JD Vance steps into spotlight defending Trump’s foreign policy in Oval Office dustup with Zelenskyy
next post
Sequans Unveils Next Generation Cellular IoT Semiconductors at Mobile World Congress 2025

Related Posts

Cyberattack halts Asahi production, disrupts Japan’s beer supply

October 3, 2025

Europe markets open: Stoxx 600 rises 0.4%, extending...

October 3, 2025

Bitcoin ETFs see over $600M in inflows as...

October 3, 2025

Stockholm leads Europe in IPO activity with $6.8...

October 3, 2025

Indonesia suspends TikTok licence after data refusal during...

October 3, 2025

Why the Thai baht’s climb against US dollar...

October 3, 2025

OpenAI valuation hits $500 billion as employees sell...

October 2, 2025

Here’s why JPMorgan, Morningstar are bullish on Alibaba...

October 2, 2025

Europe markets open: Stoxx 600 jumps 0.6%, led...

October 2, 2025

Will the Tesco share price hit 500p as...

October 2, 2025

Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.

By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

Recent Posts

  • What I Saw in Milei’s Argentina

    October 3, 2025
  • Tariffs Rest on Distrust of Citizens

    October 3, 2025
  • Cyberattack halts Asahi production, disrupts Japan’s beer supply

    October 3, 2025
  • Europe markets open: Stoxx 600 rises 0.4%, extending its record-setting rally

    October 3, 2025
  • Bitcoin ETFs see over $600M in inflows as BTC price nears $120K

    October 3, 2025
  • Stockholm leads Europe in IPO activity with $6.8 billion raised

    October 3, 2025

Editors’ Picks

  • 1

    Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • 2

    Walmart earnings preview: What to expect before Thursday’s opening bell

    February 20, 2025
  • 3

    New FBI leader Kash Patel tapped to run ATF as acting director

    February 23, 2025
  • 4

    Cramer reveals a sub-sector of technology that can withstand Trump tariffs

    March 1, 2025
  • 5

    Anthropic’s newly released Claude 3.7 Sonnet can ‘think’ as long as the user wants before giving an answer

    February 25, 2025
  • 6

    Nvidia’s investment in SoundHound wasn’t all that significant after all

    March 1, 2025
  • 7

    Pop Mart reports 188% profit surge, plans aggressive global expansion

    March 26, 2025

Categories

  • Economy (2,770)
  • Editor's Pick (279)
  • Investing (185)
  • Stock (1,885)
  • About us
  • Contact us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Read alsox

Ocado share price analysis: is this fallen...

September 10, 2025

Why did Bunzl stock sink 25% as...

April 16, 2025

Is it a golden opportunity to buy...

April 3, 2025