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Big Food is itching to hit the reset button on its story with investors turned off by the group amid Ozempic fever and consumers balking at still-inflated prices. There is.
CAGNY is officially known as the New York Consumer Analyst Group Annual Conference.
The event is well underway in Boca Raton, Florida, with big dividend payers including PepsiCo (PEP), Coca-Cola (KO), Hershey’s (HSY), Conagra Brands (CAG), and Molson Coors. Major processed food brands are participating, including TAP.
The conference is scheduled to run until Friday, and I’ve picked up some early themes here in the field, talking about sources and attending presentations.
Focus on volume: The focus is on volume recovery as Americans cut back on their purchases due to high prices (see chocolate). In a note to clients, Evercore ISI analyst David Palmer said that executives at both General Mills (GIS) and Conagra expect “the 2025 fiscal year (starting in June) to be a return to growth in line with long-term goals. I hesitate to comment on whether that will be the case.” From the event.
Hershey & Mondelez (MDLZ) called for a “price pack architecture” with products in different sizes and price points as another potential growth avenue. “We’ve always leveraged different price points and different pack sizes to make it accessible to everyone,” said Michelle Buck, Hershey’s CEO.
Innovation and marketing with new partners are also important tactics to re-engage consumers. Hershey’s, for example, thrilled the crowd with NBA legend Shaquille O’Neal in attendance to announce a partnership aimed at winning the gummy category, the fastest-growing sweets category. Conagra Brands shared that Dolly Parton’s baking line is expanding to frozen shelves.
Trading possibilities: M&A talk is alive and well, with big deals like Campbell Soup (CPB) acquiring pasta sauce maker Sovos Brands and JM Smucker (SJM) acquiring the Twinkie King Hostess brand.
While no big announcements have been made (yet), many companies have teased that they are open to the idea of a deal, but are waiting for the right company to come along at the right price.
However, this may not be the traditional acquisition that people think. John Baumgartner, managing director at Mizuho Securities, said that similar to Walmart’s acquisition of Vizio this week, “staple companies acquire differentiated high-tech companies” to better understand consumers. He said it was possible.
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