Conagra Brands Gets Successive Downgrades From Bofa, Goldman Sachs On Cost Pressures

Bank of America has downgraded its rating on Conagra Brands (CAG) to 'Underperform' from 'Neutral,' citing profit pressure, days after a similar rating action from Goldman Sachs.

According to a summary of the investor note on The Fly, BofA believes the company faces headwinds from "protein inflation" as chicken, beef, and pork prices rise.

BofA said the company's new target now reflects lower FY26-FY27 earnings per share estimates that are about 15% below consensus and a lower calendar year 2026 P/E valuation multiple. It cuts its price target on CAG to $20 from $27, signaling a 10.2% downside.

Conagra is known for Marie Callender's (frozen meat), Slim Jim (beef sticks), Healthy Choice (frozen meals and bowls), Hunt's (canned tomatoes), and Orville Redenbacher's (popcorn), among other packaged food items.

The aggressive and shifting U.S. tariff policy is driving up costs across various goods and contributing to softer consumer demand, as shoppers remain cautious amid an uneven economic landscape.

Earlier in the week, Goldman Sachs slashed its rating on the company's shares to 'Sell' from 'Neutral,' citing cost pressures, tepid volume demand amid ongoing consumption shifts toward fresh, and increasing competition from private labels.

On Stocktwits, the retail sentiment for the company shifted to 'bullish' from 'bearish.'

A user said, "The best dip buy may be $CAG."

In February, Conagra disclosed a production issue at one of its chicken processing plants, which it said drove up costs as the company had to source from other suppliers and invest in upgrades.

The company reported its third-quarter earnings in April, which showed revenue declining by 6.3% and net income by 53%.

Conagra shares are down 20% year-to-date.

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