Hormel Foods (ticker: HRL) experienced a significant decrease in its stock price, making it the worst performer in the S&P 500. As of Thursday, the stock was down 9.1% to $32.92, marking its largest percent decrease since October 20, 2008. This drop of 9.1% is comparable to the 11% decline witnessed in 2008, according to Dow Jones Market Data.
Three-Year Financial Targets
During an investor day presentation on Thursday, Hormel Foods laid out its three-year financial targets. The company is aiming for a minimum of $250 million in operating income growth by fiscal 2026. These targets will be achieved through a strategic approach incorporating three key initiatives:
1. Business Growth
Hormel Foods plans to achieve 5% to 7% growth from its current business.
2. Cost-Cutting Measures
The company aims to save at least $200 million through cost-cutting initiatives and the normalization of its supply chain.
3. Mergers, Acquisitions, and Transformation
Hormel Foods intends to secure an additional $25 million through recent mergers and acquisitions. Additionally, they will implement a transformation plan specifically for their Jennie-O Turkey Store.
Union Labor Agreement
In a separate development, the United Food and Commercial Workers International Union announced that members at Hormel Foods locations in Minnesota, Georgia, Wisconsin, and Iowa have ratified a contract. This contract includes the largest wage increase in the company’s history, with hourly wage increases ranging from $3 to $6, as well as other benefits.