Hormel’s Q3 Revenue Grows 4.6% as Stock Rises 0.87% But EPS Misses Estimates and Trading Volume Slumps to 470th Rank

Hormel Foods (HRL) closed 0.87% higher on August 29, 2025, with a trading volume of $200 million, down 54.56% from the previous day. The stock ranked 470th in trading activity. The company reported Q3 2025 earnings, showing revenue of $3.03 billion, a 4.6% year-over-year increase, but EPS of $0.33 fell short of analyst estimates by 19%. Margins remained stable at 6.1%, though commodity cost surges and Foodservice traffic softness pressured profitability. The Retail segment saw 5% volume growth, driven by brands like Spam and Jennie-O, while International sales rose 6% amid strong China demand. The company’s Transform and Modernize initiative is expected to deliver $100–150 million in annual benefits by 2025.

Despite top-line growth, Hormel faces margin compression from 400 basis points of raw material inflation in Q3, primarily due to pork, beef, and nut price spikes. Adjusted SG&A costs rose 6%, and the company plans targeted pricing actions to offset inflation, with benefits expected in late Q4 and 2026. Dividends paid $159 million in Q3, totaling $474 million year-to-date, while the net debt leverage ratio remained within the 1.5–2x target range. Guidance for Q4 adjusted EPS is $0.38–$0.40, reflecting continued commodity headwinds.

Hormel’s long-term strategy focuses on 2–3% net sales growth and 5–7% operating income growth, though 2026 guidance will be provided in the Q4 call. The company emphasized disciplined capital allocation, with $72 million in Q3 capital expenditures and $150 million in operating cash flow. While Planters’ top-line recovery is underway, profitability lags due to mix and inflation. The Foodservice segment outperformed industry growth but faces margin challenges from soft traffic and rising input costs.

Backtest results indicate HRL rose 0.87% on 8/29/2025, with a 54.56% drop in trading volume compared to the prior day. The stock’s performance reflects mixed signals from earnings and strategic initiatives, with near-term margin pressures offset by long-term growth potential in protein-centric markets and operational efficiency gains.