General Mills Inc. (GIS) reminded Wall Street on Wednesday that sometimes beating lowered expectations is exactly what you need. The packaged food giant delivered second-quarter results that topped analyst forecasts and confidently reaffirmed its full-year outlook, sending shares modestly higher.
The numbers told a solid story. General Mills posted adjusted earnings per share of $1.10, comfortably ahead of the $1.03 consensus estimate. Revenue came in at $4.86 billion, beating the Street's expectation of $4.78 billion, even though sales declined 7% compared to the same quarter last year. Not exactly explosive growth, but in today's challenging consumer environment, a beat is a beat.
CEO Jeff Harmening struck an upbeat tone in the company's announcement. "Our team continued to execute exceptionally well in a volatile operating environment, delivering results ahead of our expectations in the second quarter," he said. "Our investments in remarkability are working, helping restore organic volume growth in North America Retail this quarter and driving strong competitiveness across each of our segments."
Translation: people are buying Cheerios and Pillsbury products again, which is good news for a company that's been navigating the tricky balance between raising prices and keeping customers loyal. Harmening added that with "improved momentum in the first half and confidence in our plans to drive further improvement in the rest of the year," the company is sticking with its fiscal 2026 outlook.
General Mills shares responded with a modest 0.4% gain on Thursday, trading at $48.83.
The earnings beat prompted a couple of notable analyst moves. Bernstein's Alexia Howard maintained a Market Perform rating but trimmed the price target from $55 down to $54. Meanwhile, Wells Fargo's Chris Carey kept his Equal-Weight rating intact while bumping the target up from $50 to $51.
So there you have it: one analyst slightly more cautious, another slightly more optimistic, but both essentially saying the stock is fairly valued around current levels. Not exactly a ringing endorsement, but not a reason to run for the hills either.
