HRL US S&P 500Russell 1000 Earnings call
Hormel Foods (HRL) · Q2 2026 results and valuation
Share price: $21.95 · 2026-11-11
Results Q2 2026 vs Q1 2026 · previous quarter · fiscal Q3 2026 · published 27 Aug 2026 and 28 May 2026
Net income down 62.2% on the previous quarter. Management sounded cautious, in its script and in answers to analysts.
Only a basic analysis is available for this company at the moment.
1 · Numbers
−62.2%
Net income vs Q1 2026
Outlook given
Net income 59.6M vs 157.5M
Revenue −0.4%
Against the same quarter last year (Q2 2025) it is −67.6%, so it is not just seasonal.
Why Net income decreased primarily due to an impairment related to a minority investment in Indonesia.
2 · How management spoke
Cautious
Among the least upbeat of all company calls
Answers to analysts: typical, in line with the script.
Last call it was different: the answers were less upbeat than the script.
3 · What stood out
Hormel Foods lowered its full-year organic net sales growth expectation to a range of 1% to 2% from its previous range.
Valuation
Is Hormel Foods undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-10-26), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At −1.0% growth a year (3-year revenue growth), the model's fair value is $6.57 a share — the stock trades 234% above it. Today's price assumes 11.5% growth a year.
Current price
$21.95
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+11.5% for 10 yrs
Fair value / share
$6.57
Buy below
$4.93
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Management expects
Sales +1.5% · from the Q2 2026 report: “HRL lowered its full-year organic net sales growth expectation to a range of 1% to 2% from its previous range.”
A guidance figure for sales, usually one year ahead, not a 10-year free-cash-flow rate.
Read between the lines
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Guidance
HRL lowered its full-year organic net sales growth expectation to a range of 1% to 2% from its previous range.
Source quote
“We have also tightened our full year organic net sales growth expectation to 1% to 2% from our prior range... We remain confident in delivering fiscal 2026 adjusted earnings growth consistent with or above our long-term algorithm. Before I conclude my remarks, I want to take a moment to recognize and congratulate John Ghingo on his appointment as the next Chief Executive Officer of Hormel...”
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Guidance
The company expects a greater portion of cost-related benefits to be realized in future quarters due to the timing of cost recognition.
Source quote
“But given the timing of the cost recognition, we expect a greater portion of the benefits to be realized in future quarters.”
-
Fading
Adjusted earnings grew by double digits, which more than offset higher logistics expenses during the quarter.
Source quote
“In addition to our sales growth, earnings benefited from margin expansion, improved manufacturing performance and solid results from our joint... We also delivered impressive double digit adjusted earnings growth. Which more than offset higher logistics expenses during the quarter.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q2 2026. Ring: Q1 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Organic net sales declined with much of the pressure coming from deliberate portfolio shaping actions, reduced commodity markets and a still pressured consumer environment.”
“And so the moves with Justin's and with whole birds and with Brazil now really allow the company to better focus and reduce volatility and suboptimal performance in certain areas.”
“As Jeff and John discussed, portfolio shaping actions, softer commodity markets and the consumer environment were the primary drivers of the decline.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-07-26)
| Metric | Q2 2026period end 2026-07-26 | Q1 2026period end 2026-04-26 | Change | Q2 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 2.96B | 2.97B | −0.4% | 3.03B | −2.4% |
| Gross profit | 471.5M | 518.5M | −9.1% | 487.3M | −3.2% |
| Operating income | 110.9M | 217.1M | −48.9% | 239.7M | −53.7% |
| Net income | 59.6M | 157.5M | −62.2% | 183.7M | −67.6% |
| EPS | 0.11 | 0.29 | −62.1% | 0.33 | −66.7% |
| P/E today 32.4 | 40.8 | 25.4 | +15.4 | 21.3 | +19.5 |
Topics
Most discussed now
- Its new integrated business planning process brought visibility to this opportunity, and Hormel Foods believes it will support a more…
- Those efforts did result as Hormel Foods expected in lower production volumes flowing through portions of its manufacturing network.
- Hormel Foods' view of the logistics environment remains largely unchanged from its prior commentary.
- Please refer to Hormel Foods' most recent annual report on Form 10-K and quarterly reports on Form 10-Q, which can be...
- Through the first 9 months of the fiscal year, Hormel Foods has increased organic net sales, delivered strong adjusted earnings growth...
Faded since Q1 2026
- Dropped Whether it is convenient kitchen shortcuts substantial snacking solutions, or affordable protein options.
- Fading The combination of protein led growth and disciplined execution is apparent across Hormel Foods' results for the second quarter.
- Fading Adjusted SG&A was up just 2% reflecting good cost to discipline.
- Fading Pork and beef remained elevated relative to historical levels but overall, the commodity environment unfolded as anticipated.
Latest announcements
Official filings, newest first.
- Material agreement; Regulation FD disclosure · SEC 8-K
- Results of operations · SEC 8-K
- Director or officer change · SEC 8-K
- Director or officer change · SEC 8-K
- Director or officer change · SEC 8-K
- Results of operations · SEC 8-K
- Results of operations · SEC 8-K
- Results of operations · SEC 8-K