Conagra Brands, Inc.: Answering to a higher authority...

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Conagra Brands, Inc.: Answering to a higher authority...

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Conagra Brands, Inc.

Answering to a higher authority…

Reiterate Rating: UNDERPERFORM | PO: 13.00 USD | Price: 14.09 USD

FY27 2H skewed and not without risk 15 July 2026

4Q26 adj. EPS was modestly ahead of expectations, however the focus was Equity

predominately on FY27 which is 2H weighted and not fully de-risked, in our view.

Elasticity assumptions tied to price increases in Refrigerated & Frozen (R&F) segment

Key Changes(begins 2Q) are within historical models (Exhibit 2), however operating deleverage on the

gross margin line will make or break ability to achieve profitability guidance (operating (US$) Previous Current

margin/EPS). In addition, we see risk of distribution losses/competitive activity from 2027E Rev (m) 11,046.2 10,832.6

price increases in what is a challenged category (frozen meals). Net, while margin 2028E Rev (m) 11,073.8 10,733.5

stabilization and improvement at CAG is paramount, significant price actions to achieve 2029E Rev (m) NA 10,738.5

this are not without pushback from retailers and investors given a price wary consumer. 2027E EPS 1.50 1.40

We lower our FY27 adj EPS estimate to $1.40 (from $1.50) and reiterate our 2028E EPS 1.52 1.45

Underperform rating and $13 PO based on 9x CY27 EPS. 2029E EPS NA 1.50

2027E DPS 1.40 0.70

Refrigerated & Frozen pricing focus / portfolio reshape

The pricing actions announced by CAG today signal a strategic shift to prioritize margin Peter T. Galbo, CFA

Research Analyst

recovery over volume in R&F. CAG plans to implement inflation-justified pricing actions BofAS

primarily within frozen meals and vegetable spreads (including margarine, meat sticks, +1 646 743 0175 peter.galbo@bofa.com

Tennessee Pride and Hebrew).