Conagra Sets the Tone for Q2 Earnings: Things to Watch for CAG Stock
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December 16, 2025 — 08:07 am EST Written by Zacks Equity Research for Zacks-> Conagra Brands, Inc. CAG is likely to register a decrease in the top and bottom lines when it reports second-quarter fiscal 2026 earnings on Dec. 19.
The Zacks Consensus Estimate for revenues is pegged at about $3 billion, implying a 6.2% drop from the prior-year quarter’s reported figure. The consensus mark for earnings has remained unchanged in the past 30 days at 44 cents per share, which indicates a slump of 37.1% from the figure reported in the year-ago quarter. CAG delivered a trailing four-quarter earnings surprise of 3.53%, on average.Conagra Brands price-consensus-eps-surprise-chart | Conagra Brands QuoteConagra Brands’ second quarter is likely to reflect a business still in recovery mode. The company spent its first quarter largely resolving earlier supply and service issues, particularly across frozen and protein-heavy categories. With service levels now largely restored, the upcoming quarter should begin to reflect improved product availability and a gradual return to normal merchandising and promotional activity, though some timing shifts are still likely to weigh on near-term performance. Brand investment and innovation are also key drivers.Consumer behavior continues to shape results. Management has highlighted persistent value-seeking trends, especially among lower-income households, as inflation pressures remain elevated. Shoppers are being more selective, prompting Conagra to emphasize value-oriented offerings, pack sizes and everyday affordability rather than premium-led innovation. The efficiency of this value-driven approach will be an important factor determining volume trends during the quarter. Our model suggests a 1.3% dip in volumes for the quarter under review.Cost pressures remain a meaningful headwind. Input-cost inflation, particularly in proteins and packaging, is expected to be more evident in the second quarter as certain costs that were deferred earlier begin to flow through. While productivity initiatives and selective pricing actions are in place, these efforts are unlikely to fully offset near-term pressure, keeping margins under strain. We expect the adjusted gross margin to contract 330 basis points to 23.1% in the second quarter.Our proven model predicts an earnings beat for Conagra Brands this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is exactly the case here. Conagra Brands has a Zacks Rank #3 and an Earnings ESP of +0.11% at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.Here are some other companies worth considering, as our model shows that these also have the right combination of elements to beat on earnings this reporting cycle.Kimberly-Clark Corporation KMB currently has an Earnings ESP of +4.45% and a Zacks Rank of 3. The consensus mark for quarterly revenues is pegged at $4.13 billion, which indicates a decline of 16.2% from the figure reported in the prior-year quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for Kimberly-Clark’s quarterly earnings per share (EPS) is pegged at $1.54, which implies 2.7% growth year over year. KMB delivered a trailing four-quarter earnings surprise of 10.5%, on average.The Hershey Company HSY currently has an Earnings ESP of +0.91% and a Zacks Rank of 3. The consensus estimate for Hershey’s quarterly revenues stands at $2.97 billion, which calls for a 3% jump from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Hershey’s upcoming quarter’s EPS is pegged at $1.39, which implies a 48.3% decrease year over year. HSY delivered a trailing four-quarter earnings surprise of nearly 15%, on average.Philip Morris PM currently has an Earnings ESP of +0.20% and a Zacks Rank of 3. The consensus estimate for quarterly revenues is pegged at $10.41 billion, which calls for 7.2% growth from the figure reported in the prior-year quarter.
The Zacks Consensus Estimate for Philip Morris’ upcoming quarter’s bottom line is pegged at $1.67 per share, which suggests a 7.7% increase from the figure recorded in the year-ago period. PM delivered a trailing four-quarter earnings surprise of 4.4%, on average. Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational. From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportHershey Company (The) (HSY) : Free Stock Analysis ReportPhilip Morris International Inc. (PM) : Free Stock Analysis ReportKimberly-Clark Corporation (KMB) : Free Stock Analysis ReportConagra Brands (CAG) : Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchThe views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.This data feed is not available at this time.