Consumers still trust their leading brands

Article Excerpt

The overall U.S. inflation rate for the year ended April 2023, was 4.9%. However, the rise in grocery prices was even steeper at 7.1%. That’s because foodmakers have raised their selling prices to offset higher ingredient and other costs. Those higher selling prices, along with better cost controls, are fuelling strong earnings gains at these three foodmakers. All their prices are likely to remain high, but we feel Conagra and Lamb Weston are better positioned to hang on to their customers than General Mills. CONAGRA BRANDS INC. $35 is a buy. The company (New York symbol CAG; Income Portfolio, Consumer sector; Shares outstanding: 476.9 million; Market cap: $16.7 billion; Price-to-sales ratio: 1.5; Dividend yield: 3.8%; TSINetwork Rating: Above Average; www.conagrabrands.com) makes a variety of popular foods, including Chef Boyardee canned pasta, Hunt’s tomato sauce, Orville Redenbacher popcorn and Reddi-wip whipped cream. The company continues to raise its selling prices to offset increasing costs for ingredients, packaging and shipping. Sales in its fiscal 2023 third quarter, ended…