Bear of the Day: The Campbell's Company (CPB)

The Campbell's Company CPB stock has tumbled over the last several years as shifting consumer habits, strong competition from upstarts, and other headwinds have dented its earnings outlook.

CPB, which is also being hit by tariffs, saw its earnings revisions fade again after it provided disappointing guidance when it reported its second-quarter fiscal 2026 results on March 11.

Campbell's recent downward earnings revisions earn the stock a Zacks Rank #5 (Strong Sell) and continue a rough stretch for the maker of everything from its namesake soups to Goldfish, Prego, and other shelf-stable staples.

Why Campbell's Stock is a Zacks Rank #5 (Strong Sell)

Campbell’s is a historic North American food company that manufactures and markets a wide range of packaged foods and beverages, including iconic soups, broths, sauces, juices, and snacks.

Campbell’s portfolio is split into two main segments: Meals & Beverages (featuring Campbell’s soups, Swanson broth, Prego and Rao’s pasta sauces, V8 juices, and more) and Snacks (including Goldfish, Pepperidge Farm, Snyder’s pretzels, Cape Cod chips, and more).

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The company has been expanding through some key acquisitions of rising stars in the space, including Rao’s, which makes higher-end pasta sauces, dry pasta, frozen entrées, frozen pizza, and soups.

Campbell’s remains a titan of the wider consumer-packed goods industry. But CPB, and the broader industry, is increasingly coming under pressure from multiple headwinds.

The list of setbacks and hurdles Campbell’s faces includes changing consumer habits, the potential impact of GLP-1 weight loss drugs, upstart competition, and tariffs.

The Wall Street Journal reported back in October that: “middle- and high-income Americans are still splurging, just not on legacy labels.”

“Their dollars are flowing to niche names with more cultural cachet, from fancy new protein bars to chewier candy… So-called insurgent brands now capture a wildly disproportionate share of growth. Though they make up less than 2% of food, beverage and household products, they drove nearly 39% of incremental category gains in 2024.”

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Campbell’s earnings outlook has transitioned from moving sideways (2022-2024) to tumbling as it struggles to navigate the rapidly evolving operating environment. CPB’s consensus FY26 earnings estimate dropped 7% since its Q2 FY26 release on March 11, with its FY27 estimate 6% lower.

CPB’s recent downward revisions land it a Zacks Rank #5 (Strong Sell). This backdrop means that investors should likely look elsewhere for stocks to buy right now.

On top of that, Campbell’s recent downtrend prolongs a nearly decade-long downturn for the stock that’s seen it massively underperform the market. CPB stock has dropped 30% in the past 25 years.

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The Campbell's Company (CPB): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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