IntrinsicIntrinsic
← All summaries

CONAGRA BRANDS INC.

CAG
Financials & Chart →

Business Summary

Conagra Brands, Inc. is one of North America's leading branded food companies, operating in the highly competitive food industry. The industry is characterized by intense competition based on brand recognition, product quality, price, and innovation. The company's portfolio is continuously evolving to satisfy consumers' ever-changing food preferences, and it competes with widely advertised, well-known branded food as well as private label and customized food items. Some competitors are larger and have greater resources. The industry is influenced by holidays, changes in seasons, or other annual events, with sales of frozen foods tending to be marginally higher during the winter months and pie sales highest in November and December.

Conagra Brands' largest customer, Walmart, Inc. and its affiliates, accounted for approximately 29% of consolidated net sales for fiscal 2026 and 2025 and 28% for fiscal 2024 . The company's 10 largest customers accounted for approximately 60% of consolidated net sales in fiscal 2026 . The company competes primarily on the basis of quality, product innovation, value, convenience, customer service, brand recognition, and brand loyalty. Its principal competitors have substantial financial, marketing, and other resources.

The company generates revenue through the sale of branded, value-added consumer food products, as well as foodservice items and ingredients. Products are sold, directly and through distributors, to chain, wholesale, value, cooperative, club, and independent grocery, pharmacy and drug, convenience and other store operators; and foodservice customers, including restaurants and bars, travel and leisure customers, schools, health care facilities, and government customers. Products are also sold online through various e-commerce platforms and retailers.

The Grocery & Snacks reporting segment principally includes branded, shelf-stable food products sold in various retail channels in the United States. Net sales for this segment were $4,610.1 million in fiscal 2026 and $4,899.3 million in fiscal 2025 . The Refrigerated & Frozen reporting segment principally includes branded, temperature-controlled food products sold in various retail channels in the United States. Net sales for this segment were $4,641.8 million in fiscal 2026 and $4,662.3 million in fiscal 2025 . The International reporting segment principally includes branded food products, in various temperature states, sold in various retail and foodservice channels outside of the United States. Net sales for this segment were $913.9 million in fiscal 2026 and $956.5 million in fiscal 2025 . The Foodservice reporting segment includes branded and customized food products, including meals, entrees, sauces, and a variety of custom-manufactured culinary products packaged for sale to restaurants and other foodservice establishments primarily in the United States. Net sales for this segment were $1,115.8 million in fiscal 2026 and $1,094.7 million in fiscal 2025 .

Conagra's brands include Birds Eye, Duncan Hines, Healthy Choice, Marie Callender's, Reddi-wip, Slim Jim, and Angie's BOOMCHICKAPOP, among many others. The company has two unconsolidated equity investments, with its most significant being the Ardent Mills joint venture, a milling business. Some products are sold under licensing arrangements with others, including Dolly Parton and licenses of the P.F. Chang's, Bertolli, Wendy's, and Libby's trademarks. The company also owns certain intellectual property rights licensed to third parties, such as the Alexia and Marie Callender's trademarks.

During fiscal 2026, the company acquired the manufacturing operations of an existing contract manufacturer of cooking spray products for a cash purchase price of $51.2 million , and acquired the outstanding equity of Sweetwood Smoke & Co., maker of FATTY smoked meat sticks, for a cash purchase price of $179.4 million . The company issued $500.0 million aggregate principal amount of 5.00% senior unsecured notes due August 1, 2030 and $500.0 million aggregate principal amount of 5.75% senior unsecured notes due August 1, 2035 . The company repaid the entire $1.0 billion aggregate principal amount of 4.60% senior unsecured notes on the maturity date of November 1, 2025 . The company repurchased 0.8 million shares of its common stock for an aggregate of $15.0 million . The company recorded goodwill impairments of $2.38 billion in its Refrigerated & Frozen reporting unit and total indefinite-lived intangibles impairments of $547.2 million . The company also divested its Chef Boyardee and frozen fish businesses, receiving proceeds totaling $648.9 million .

Net sales for fiscal 2026 were $11,281.6 million, a decrease of 2.9% compared to $11,612.8 million in fiscal 2025 . Gross profit was $2,698.4 million in fiscal 2026 compared to $3,003.5 million in fiscal 2025 . Net loss attributable to Conagra Brands, Inc. was $1,916.2 million in fiscal 2026 compared to net income of $1,152.4 million in fiscal 2025 . Diluted loss per share was $4.00 in fiscal 2026 compared to diluted earnings per share of $2.40 in fiscal 2025 . Cash generated from operating activities totaled $1.40 billion in fiscal 2026 compared to $1.69 billion in fiscal 2025 .

Business Outlook

Management expects the effective tax rate in fiscal 2027, exclusive of any unusual transactions or tax events, to be approximately 24% . The preliminary estimate of capital expenditures for fiscal 2027 is approximately $550 million . Management anticipates contributing approximately $10.3 million to its pension plans in fiscal 2027 and expects to make payments totaling approximately $6.1 million to fund postretirement plans in fiscal 2027 .

The company plans to continue its focus on innovation to meet consumers' changing preferences, particularly as consumers prioritize wellness and weight management goals, including portion-controlled, high protein, and high fiber meals and snacks. Management believes this positions the company's portfolio of products well for fiscal 2027. The company also anticipates that it may need to increase prices on certain products in fiscal 2027 to mitigate margin impacts from input cost inflation and would expect corresponding elasticity impacts.

Management has approved a multi-year transformation initiative called Project Catalyst that seeks to simplify and modernize operations through process redesign, technology adoption, and organizational optimization to accelerate growth, improve productivity, and enhance cash flow performance. The company anticipates that it may invest as much as approximately $40 million in capital expenditures for Project Catalyst initiatives in fiscal 2027 . The company continues to define and identify initiatives under Project Catalyst, some of which may result in restructuring charges.

Management anticipates continued elevated levels of input cost inflation in fiscal 2027, and the company could experience higher than expected input cost inflation in specific commodities or across multiple commodities. The company will continue to seek to offset input cost inflation with productivity initiatives and tariff mitigation efforts. Throughout fiscal 2027, continued consumer sensitivity to price increases may negatively impact volumes while input cost inflation could negatively impact earnings.

The company expects to maintain or have access to sufficient liquidity to retire or refinance long-term debt at maturity or otherwise, from operating cash flows, its commercial paper program, access to the capital markets, and its Revolving Credit Facility. The company has $500.0 million aggregate principal amount of 5.3% senior unsecured notes and $262.5 million aggregate principal amount of 7.125% senior unsecured notes maturing in October 2026 that it expects to pay and/or refinance using available sources which may include the investment grade note market, bank loans, commercial paper, and cash on hand .

The company's total remaining share repurchase authorization as of May 31, 2026 was $837.6 million . On March 31, 2026, the company announced that its Board had authorized a quarterly dividend payment of $0.35 per share, which was paid on June 3, 2026 . Subsequent to fiscal year end, on July 15, 2026, the company announced that its Board had authorized a quarterly dividend of $0.175 per share to be paid on September 2, 2026 .

Rapidly changing U.S. tariffs and reciprocal tariffs caused increased uncertainty as well as input cost inflation in key materials used in the company's products, including tin-plate steel used in packaging for canned products. The company continues to closely monitor the changing tariff landscape and the impact it has on its business. Management cannot guarantee that strategies to mitigate resulting cost increases, including working to increase productivity, cut other costs, and increase pricing on products, will be fully successful, if at all, sufficient or sustainable.

The company expects consumer expectations to continue to evolve, with consumers continuing to seek products that enhance their wellness and weight management goals. The increase in affordability and accessibility of weight loss drugs is noted as a factor influencing consumer preferences. The company also faces structural headwinds from weak consumer sentiment, inflation, commodity cost fluctuations, supply chain pressures, trade and regulatory uncertainty, and other global macroeconomic challenges.

Risk Factors

The company faces material risks from its significant debt level of approximately $7.27 billion as of May 31, 2026 , which could limit cash flow available for investment and restrict the ability to return cash to stockholders. Customer concentration risk is substantial, with Walmart, Inc. and its affiliates accounting for approximately 29% of consolidated net sales in fiscal 2026 and the 10 largest customers accounting for approximately 60% . The company is exposed to commodity price volatility, having recorded goodwill impairments of $2.38 billion in the Refrigerated & Frozen reporting unit and indefinite-lived intangibles impairments of $547.2 million in fiscal 2026, with further impairment risk if long-term sales forecasts or other assumptions change. Supply chain disruptions, input cost inflation, and rapidly changing tariffs on key materials like tin-plate steel used in packaging present ongoing operational risks. The company also faces risks from changing consumer preferences, including the impact of weight loss medication on food consumption patterns.

Management Priorities

Management's message emphasizes the company's transformation into a branded, pure-play consumer packaged goods food company focused on delivering sustainable, profitable growth with strong and improving returns on invested capital. The tone acknowledges the challenging macroeconomic environment, including weak consumer sentiment, inflation, commodity cost fluctuations, supply chain pressures, trade and regulatory uncertainty, and other global macroeconomic challenges. Key strategic priorities for the period ahead include continuing to offset input cost inflation with productivity initiatives and tariff mitigation efforts, focusing on innovation to meet consumers' changing preferences particularly around wellness and weight management, and executing the newly announced multi-year transformation initiative, Project Catalyst, to simplify and modernize operations. Management expects the effective tax rate in fiscal 2027, exclusive of any unusual transactions or tax events, to be approximately 24% and the preliminary estimate of capital expenditures for fiscal 2027 is approximately $550 million .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Customers
  2. [2] Item 1A, Risk Factors — Competition Risks
  3. [3] Item 7, MD&A — Segment Review, Net Sales
  4. [4] Item 7, MD&A — Segment Review, Net Sales
  5. [5] Item 7, MD&A — Segment Review, Net Sales
  6. [6] Item 7, MD&A — Segment Review, Net Sales
  7. [7] Item 8, Note 2 — Acquisitions
  8. [8] Item 8, Note 2 — Acquisitions
  9. [9] Item 7, MD&A — Liquidity and Capital Resources, Borrowing Facilities and Long-Term Debt
  10. [10] Item 7, MD&A — Liquidity and Capital Resources, Borrowing Facilities and Long-Term Debt
  11. [11] Item 7, MD&A — Liquidity and Capital Resources, Equity and Dividends
  12. [12] Item 7, MD&A — Critical Accounting Estimates, Business Combinations, Impairment of Long-Lived Assets
  13. [13] Item 7, MD&A — Critical Accounting Estimates, Business Combinations, Impairment of Long-Lived Assets
  14. [14] Item 7, MD&A — Cash Flows
  15. [15] Item 8, Consolidated Statements of Operations
  16. [16] Item 8, Consolidated Statements of Operations
  17. [17] Item 8, Consolidated Statements of Operations
  18. [18] Item 8, Consolidated Statements of Operations
  19. [19] Item 8, Consolidated Statements of Cash Flows
  20. [20] Item 7, MD&A — Income Taxes
  21. [21] Item 7, MD&A — Liquidity and Capital Resources, Capital Expenditures
  22. [22] Item 7, MD&A — Critical Accounting Estimates, Employee-Related Benefits
  23. [23] Item 7, MD&A — Contractual Obligations
  24. [24] Item 8, Note 3 — Restructuring Activities
  25. [25] Item 7, MD&A — Liquidity and Capital Resources, Borrowing Facilities and Long-Term Debt
  26. [26] Item 7, MD&A — Liquidity and Capital Resources, Equity and Dividends
  27. [27] Item 7, MD&A — Liquidity and Capital Resources, Equity and Dividends
  28. [28] Item 7, MD&A — Liquidity and Capital Resources, Equity and Dividends
  29. [29] Item 1A, Risk Factors — Credit Risks
  30. [30] Item 1, Business — Customers
  31. [31] Item 1A, Risk Factors — Consumer and Customer Risks
  32. [32] Item 7, MD&A — Critical Accounting Estimates, Business Combinations, Impairment of Long-Lived Assets
  33. [33] Item 7, MD&A — Critical Accounting Estimates, Business Combinations, Impairment of Long-Lived Assets
  34. [34] Item 7, MD&A — Income Taxes
  35. [35] Item 7, MD&A — Liquidity and Capital Resources, Capital Expenditures
  36. [36] Item 8, Consolidated Statements of Operations
  37. [37] Item 8, Consolidated Statements of Operations
  38. [38] Item 8, Consolidated Statements of Operations
  39. [39] Item 8, Consolidated Statements of Operations
  40. [40] Item 8, Consolidated Statements of Operations
  41. [41] Item 8, Consolidated Statements of Operations
  42. [42] Item 8, Consolidated Statements of Cash Flows
  43. [43] Item 1A, Risk Factors — Credit Risks
  44. [44] Item 8, Consolidated Statements of Operations
  45. [45] Item 8, Consolidated Statements of Operations
  46. [46] Item 8, Consolidated Statements of Operations
  47. [47] Item 7, MD&A — Items Impacting Comparability
  48. [48] Item 7, MD&A — Items Impacting Comparability
  49. [49] Item 7, MD&A — Segment Review, Segment Operating Profit
  50. [50] Item 7, MD&A — Segment Review, Segment Operating Profit
  51. [51] Item 7, MD&A — Segment Review, Segment Operating Profit
  52. [52] Item 7, MD&A — Segment Review, Segment Operating Profit

Analysis on 7/16/2026