Campbell Soup issues warning on 2024 full-year outlook

Campbell Soup Company (CPB) has issued a warning regarding its full-year guidance, indicating that it is tracking towards the lower end of its reported outlook. The company's second quarter results revealed a 2% decline in volumes, highlighting consumers' challenges in the current economic climate.

Yahoo Finance's Seana Smith and Bradley Smith break down the details.

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Editor's note: This article was written by Angel Smith

Video Transcript

BRAD SMITH: And let's take another look at another trending ticker that we're watching here this morning, Campbell's Soup shares rising despite warning its full year performance is tracking to the low end of its initial guidance range, but saying a possible turnaround should come-- or could come should the pace of consumer recovery accelerate.

This was an interesting one to look at. The net sales were actually down by about 1%, both on a reported and organic basis. You had net sales increase on a compound annual growth rate to year of about 5%, organic net sales increased 6% over that time due to favorable net price realization. So putting price into the system, raising some of those prices here, the only thing that really is perhaps one of the levers to pull, but volume's really more of perhaps the going concern here.

SEANA SMITH: Yeah, wasn't able to fully offset the fact that we did see that 2% decline in volumes in the most recent quarter prices at Campbell's products rising just about 1%. So people were out there. They were buying those ready-to-eat meals that we've been talking about. They were buying the canned goods, yet not at the rate that was enough to offset some of the weakness that we're seeing across the board.

And I think this is just the latest company to really illustrate the fact that consumers remain under pressure. Inflation is still a huge issue for American shoppers out there. They're being forced to make some decisions, cut back on their overall spending. And we're even seeing it hit some of these consumer staples stocks.

And this is a name that's down just about 18%, I believe, over the last year. Comparing that to the outperformance that we've seen overall obviously to the S&P, a clear underperformer within that. Off just about 15%. So we'll see. As long as the consumer remains under pressure, you would think a name like Campbell's Soup obviously wouldn't fare too well in the current environment.

BRAD SMITH: A name that's been in a lot of people's pantries over the years. And some quarterbacks have even helped to promote a little bit. We're looking at Donovan McNabb. Anyway, Eagles fandom. Whatever.