Campbell Soup: Harvesting the Ingredients to Cook Up Sales and Margin Gains; Shares Attractive

Wide-moat Campbell Soup has orchestrated significant changes since CEO Mark Clouse took the helm in January 2019. For one, the portfolio mix has shifted quite dramatically, such that its core soup lineup now accounts for only around one quarter of total sales (down from more than 40% in fiscal 2017) and snacks makes up around 50% (up from less than 30%). In addition, the firm has worked to drive efficiencies across its supply chain and manufacturing network to fuel spending behind innovation and marketing to solidify its standing with retailers and consumers. These efforts have manifested in 3% average annual organic sales growth over the past five years against mid- to high-teens adjusted operating margins.