General Mills (GIS) Stock Forecast & Price Target

General Mills has demonstrated strong resilience and adaptability through a strategic approach that capitalized on pantry-loading trends during the COVID-19 pandemic, allowing the company to implement multiple price increases in response to rising inflation. The company's performance in the pet food segment has outpaced expectations, and an anticipated return to growth for the Blue Buffalo brand is expected to further enhance overall revenue through premiumization and market expansion. Additionally, the forecast suggests a promising innovation pipeline and an expected reacceleration in core business momentum, contributing to a positive outlook for organic sales and earnings per share growth in the coming years.

General Mills has revised its 3Q organic growth estimate to -3.1%, indicating a deterioration in revenue expectations, with a projected earnings per share (EPS) of $0.96, aligning with consensus but highlighting downward pressure on its financial performance. The company is experiencing a decline in EBIT margins and anticipates a more than 4% decrease in EBIT, attributed to operational challenges such as inventory headwinds, particularly in its North American Retail (NAR) business and the pet segment. Furthermore, market dynamics remain unfavorable, as evidenced by negative commentary from peers and persistent underperformance compared to broader consumer staples indices, exacerbated by international challenges and consumer traffic declines in key markets.