Campbell Soup stock rises after Q4 results, lifted by better-than-expected guidance

By James Rogers

Campbell's pointed to its meals and beverages segment as a standout in the fourth quarter

Shares of Campbell Soup Co. are up 1.1% in premarket trades Thursday after the soups and foods company delivered stronger-than-expected sales outlook despite swinging to a fourth-quarter loss.

For the quarter to July 28, Campbell's (CPB) reported a net loss of $3 million, or a loss of 1 cent a share, after net income of $169 million, or earnings of 57 cents a share, in the prior year's quarter. Adjusted earnings per share were 63 cents, up from 50 cents a share a year earlier, beating the FactSet consensus of 62 cents.

Net sales grew 11% to $2.293 billion, just below the FactSet consensus of $2.312 billion. "We finished fiscal 2024 with solid fourth-quarter performance including sequential volume improvement and margin expansion versus prior year and delivered significant progress against our longer-term strategic plan despite an evolving consumer landscape," said Campbell's Chief Executive Mark Clouse, in a statement.

Related: Campbell Soup prices didn't rise for first time in three years

Meals and beverage sales were $1.2 billion, up from $936 million in the same period last year. Snacks revenue was $1.093 billion, down from $1.132 billion in the prior year's quarter.

Within meals and beverage, volume and mix rose 2% from the same period last year, while prices slipped 1%. For snacks, volume and mix were flat year-over-year and prices fell 2%.

"The strength of the Meals & Beverages recovery, including Soup, was a standout in the quarter as was the competitive advantage of our supply chain," said Clouse, in the statement. "The integration of Sovos Brands is progressing ahead of our expectations, marking a transformative shift in our Meals & Beverages growth trajectory."

Related: Campbell Soup to cut costs, 415 employees affected

Earlier this year Campbell's completed its $2.7 billion acquisition of Rao's parent Sovos Brands.

For the full year 2025, Campbell's expects net sales growth of 9% to 11%, or $10.503 billion to $10.696 billion, at the high end of the FactSet consensus of $10.510 billion. This reflects a full twelve-month contribution from Sovos Brands and the loss of eleven months of net sales from the divestiture of Pop Secret, the company said.

Campbell's also expects adjusted earnings growth of 1% to 4%, or $3.12 to $3.22 a share, with Sovos Brands expected to be approximately neutral and including the impact of the Pop Secret divestiture. Analysts surveyed by FactSet are looking for adjusted full-year earnings of $3.22.

Related: Campbell Soup to acquire Rao's parent Sovos Brands $2.7 billion deal

Campbell Soup shares are up 16.1% in 2024, compared with the S&P 500 index's SPX gain of 17.2%.

-James Rogers

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08-29-24 0913ET

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