WASHINGTON (dpa-AFX) - Hormel Foods Corp. (HRL) late Tuesday issued first-quarter outlook, expecting earnings above market, but net sales below the Street. Further, the firm reaffirmed fiscal 2026 outlook for organic net sales and adjusted earnings per share.
Separately, the Fortune 500 branded food company announced that it has entered into a definitive agreement to sell its whole-bird turkey business to Life-Science Innovations or LSI, reflecting its ongoing portfolio shaping efforts. Financial details of the deal have not been disclosed.
In its preliminary first-quarter results, the company said it expects earnings per share of $0.33 and adjusted earnings per share of $0.34.
Net sales would be around $3 billion, reflecting 2 percent organic net sales growth year-over-year.
The Wall Street analysts on average expect the company to report earnings of $0.32 per share on sales of $3.07 billion for the quarter. Analysts' estimates typically exclude special items.
Regarding the preliminary first quarter results, Jeff Ettinger, interim chief executive officer, stated, 'They reflect a solid start to the year, are aligned with our expectations and give us confidence that we are focused on the right initiatives to return Hormel Foods to profitable growth.'
At the 2026 CAGNY conference on Wednesday, Ettinger will reaffirm the fiscal 2026 guidance and review key initiatives for success in fiscal 2026. Further, John Ghingo, president, will discuss expectations for achieving its previously announced long-term growth algorithm of 2-3 percent organic net sales growth and 5-7 percent operating profit growth, among others.
Regarding its planned sale of whole-bird turkey business, the company said the deal is expected to close by the end of its second quarter of fiscal 2026, subject to customary closing conditions.
In the deal, LSI will acquire Hormel Foods assets, including the Melrose, Minnesota, whole-bird production facility; Swanville, Minnesota, feed mill; and associated transportation assets. LSI will also assume supply contracts with third-party turkey growers dedicated to the whole-bird business and provide co-manufacturing services to Hormel Foods through the end of its fiscal 2026, to meet customer orders during the transition.
Meanwhile, the broader array of JENNIE-O branded products, and ownership of the JENNIE-O brand name, are not impacted by the sale.
Hormel Foods said the transaction supports strategic shift toward more value-added protein offerings.
The company currently estimates minimal impact on net sales and adjusted earnings per share guidance for fiscal 2026. Additional information on the transaction will be provided as part of the firm's first quarter earnings announcement, scheduled for February26.
In the overnight trading, Hormel Foods shares were losing 0.9 percent, after closing Tuesday's regular trading 1.4 percent lower at $23.44.
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