GIS: Quick Take on Earnings

研报英文原文证据摘录

GIS: Quick Take on Earnings

EQUITY RESEARCH QUICK TAKE

RBC Capital Markets, LLC

Nik Modi (Co-Head of Global Consumer &

Retail Research)

Chris Peters (AVP)

Clark Lee (AVP)

Curtis Farfan, CFA (AVP)

July 1, 2026

General Mills, Inc.

Quick Take on Earnings

NYSE: GIS | USD 34.80 | Outperform | Price Target USD 45.00

Sentiment: Neutral

Prior Investment Thesis: GIS fundamentals have been under pressure over the last 2+ years as elongated economic pressures

impact consumer spending habits and category growth rates. In order to navigate the tough operating environment, GIS made the

decision to cut prices across most of its portfolio subsequently resetting earnings for 2026. While the subdued category growth

rates are elongating the recovery timeline back to positive growth, our DCF valuation with conservative longterm estimates suggest

upside to current levels. Further, GIS is leaning into the Pet segment with recent acquisitions of premium brands. We believe that

there are long term structural tailwinds supporting the pet category, which GIS stands to benefit from.

Impact to Thesis: GIS reported a better than expected quarter with a top and bottom line beat. Organic sales exceeded

expectations in North America, Foodservice, and International, but results were weaker than expected in Pet (impacted by retailer

inventory adjustments). NAR's flat organic sales outpaced consumption by ~4pts, driven by a previously anticipated ~2pt trade

expense timing tailwind and a ~2pt benefit from changes in retailer inventory. Solid margins were supported by net favorable below

the line items leading to EPS of $0.95 (vs cons $0.79). Overall, we attribute the outperformance to more one time/mechanical

factors, given that consumption remains subdued.