General Mills Stock Slips On Lowered Fiscal 2025 Guidance: Retail Sentiment Dips

Shares of General Mills fell more than 3% on Wednesday following lowered guidance on lowered profit guidance, even as it reported an earnings beat, dampening retail sentiment.

The company posted earnings per share of $1.40 on revenues of $5.24 billion. Consensus estimates had been $1.22 for EPS on $5.14 billion of revenues. Its net sales rose 2% with organic net sales increasing by 1%.

However, the Cheerios maker lowered its fiscal 2025 adjusted EPS forecast. Adjusted diluted EPS is now expected to range from down 3% and 1% in constant currency, compared to the previous range of down 1% and up 1% in constant currency.

It also expects its full-year organic net sales growth to be at the lower end of its previously reported range of flat to up 1% because of increased promotional investment, according to a company statement.

“We made important progress accelerating our volume growth and market share trends in the first half of the year, including returning our North America pet business to growth,” CEO Jeff Harmening said in a statement.

"As we moved through the quarter, it became clear that our product news and media support he reportedly said after the earnings, Reuters reported.

Retail sentiment on Stocktwits fell to ‘extremely bearish’ from ‘bullish’ a day ago. While message volumes climbed to the ‘extremely high’ zone.

GIS sentiment meter and message volumes on Dec 18 as of 10:40 pm ET

Following the earnings, BofA analyst Peter Galbo lowered the firm's price target to $78 from $80 with a Buy rating, The Fly.com reported. According to the analyst, the negative stock reaction following Q2 earnings is based on the increased investment spend planned in the second half of FY25, primarily in North America Retail.

Citi also lowered its price target to $67 from $71 with a Neutral rating after the fiscal 2025 guidance cut. The firm appreciates that General Mills is trading at the low end of its historic valuation ranges. The firm lowered estimates to reflect “both low sales expectations and more margin pressure,” The Fly.com reported.

General Mills also said it completed the acquisition of Whitebridge Pet Brands’ North American premium Cat feeding and Pet treating business from NXMH in a transaction valued at $1.45 billion. The deal includes such brands as Tiki Pets and Cloud Star.

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