Hormel Foods Corp (NYSE:HRL) shares sank nearly 14% to about $25 in late-morning trading on Thursday after the global food company’s third-quarter financial results disappointed investors.
Hormel reported adjusted earnings per share (EPS) for the period of $0.35, falling short of the $0.41 analyst consensus estimate. The company cited climbing commodity costs as the primary reason for its weaker results.
Its revenue for the quarter, though, rose 4.6% year-over-year to $3.03 billion, edging past Wall Street expectations of $2.98 billion.
The company’s international sales during the period were 6% higher on an 8% increase in volume, although the division’s profit fell 13%.
“We expect profit recovery to lag into next year, with the near-term pressures we experienced in the third quarter persisting through the fourth quarter,” Hormel Foods interim CEO Jeff Ettinger said in a statement.
Hormel's current quarter outlook is for adjusted EPS of between $0.38 and $0.40. The analyst consensus forecast is for $0.49.