We recently compiled a list of the 10 Best Cookies and Crackers Stocks to Buy. In this article, we are going to take a look at where Conagra Brands, Inc. (NYSE:CAG) stands against the other cookies and crackers stocks.
The Global Cookie and Cracker Market
The global cookie and cracker market was valued at $100.2 billion in 2023 and is expected to grow to $122.45 billion by 2030, growing at a compound annual growth rate of 3.7% during the forecast period between 2024 and 2030. Region-wise, North America dominates the market with the United States and Canada as its top markets. With significant markets in the United Kingdom, Germany, and France, Europe follows. Simultaneously, Asia Pacific is depicting rapid growth with significant market expansion in countries such as China and India.
What is the Global Snacking Industry Looking Like?
According to Mondelēz International’s annual State of Snacking Report 2023, consumers continue to snack strong as 6 in 10 global consumers surveyed for the last 5 years have been consistently of the opinion that they tend to eat many small meals throughout their days instead of few large ones while young people look forward to the snacks in their day, more as compared to the meals. Younger consumers tend to snack once or more a day. Across all ages, the majority have ritualized snack time as they consume a snack at a special moment or time of the day.
Consistent snack spending is evident from the fact that two-thirds of consumers have not made significant changes to their spending on snacks although they are more conscious of price. Recently, consumers have cut back spending on non-essential items which has negatively impacted sales for Starbucks and McDonald’s. However, the threat doesn’t seem major to the snacking industry as snacking giants still see snacking as a large, attractive, and durable category that continues to grow in importance with consumers.
A piece of important news surfacing in the market just before the year’s end, as reported by CNBC, is that the Oreo maker has made a preliminary takeover approach for Hershey according to those familiar with the matter. The company had previously made a takeover bid for Hershey in 2016 which Hershey’s board unanimously rejected. The acquisition, if it takes place, is going to result in one of the biggest confectionery companies globally. While the combined business could be a huge deal, the question about it competing against the recent Mars’ acquisition of Kellanova which is expected to materialize in the coming year, is circulating all around. This acquisition is a great deal in the global snacking market as well since it ranks among the top 10 global food and beverage mergers and acquisitions since 1995, as revealed by Dealogic.
Our Methodology:
In order to compile a list of the 10 best cookies and crackers stocks to buy, we went through stock screeners, relevant ETFs, and media reports to make a list of relevant stocks. Moving on, we shortlisted the top 10 stocks from our list which had the highest number of hedge fund holders. The 10 best cookies and crackers stocks to buy have been arranged in ascending order of their hedge fund holders, as of Q3.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A worker assembling a meal in a food production facility.
Conagra Brands, Inc. (NYSE:CAG)
Number of Hedge Fund Holders: 26
Conagra Brands, Inc. (NYSE:CAG) is one of North America’s leading branded food companies. The firm has a portfolio of iconic and emerging brands that continue to evolve to cater to the needs of its consumers. Conagra’s brands include Birds Eye, Duncan Hines, Healthy Choice, Marie Callender’s, Reddi-wip, Slim Jim, and Angie’s BOOMCHICKAPOP among others. The firm’s Glutino brand is a leader in the gluten-free snacks category and offers a diverse range of gluten-free cookies as well as crackers.
The business is over 100 years old since it began as a Midwestern flour-milling company and entered other commodity-based businesses later, eventually positioning itself as a strong branded, pure-play consumer packaged goods food company. The firm has grown its food businesses through innovation that helps deliver great-tasting food across both its iconic and emerging brands, organic growth of its brands, and expansion into adjacent categories, including through acquisitions. The firm generated fiscal 2024 net sales of more than $12 billion.
Conagra Brands, Inc. (NYSE:CAG) continues to strengthen its impressive portfolio of industry-leading brands. Back in June, the firm debuted its dynamic collection of new products, including arrivals in single-serve and multi-serve frozen meals, frozen vegetables, and snacks. Among the new lineup were six delicious new sandwich cookies and pretzels from Glutino.
Simultaneously, the firm continues to efficiently navigate a challenging consumer environment. The business successfully returned to growth in the second quarter of fiscal year 2025 as it drove volume improvement, organic net sales up 30 basis points over the prior year, and market share gains. It is worth noting that 67% of Conagra’s portfolio held or gained volume share in the second quarter, marking the fifth consecutive quarter of share gains. The share performance was so good that Conagra outperformed its closest peer by 24 percentage points. Although the top-line momentum is expected to continue in the second half, the profitability will be impacted by two headwinds which are higher-than-expected inflation and unfavorable foreign exchange rates.
Overall CAG ranks 6th on our list of the best cookies and crackers stocks to buy. While we acknowledge the potential of CAG as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a deeply undervalued AI stock that is more promising than CAG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
