General Mills Inc (NYSE:GIS, XETRA:GRM) shares remain under pressure as it faces continued volume declines in North America Retail (NAR) and limited near-term upside despite recent price investments, Jefferies analysts have highlighted.
The analysts maintained a ‘Hold’ rating and $42 price target on the stock, below its recent price of $45, and framed its outlook around whether the company’s pricing actions will ultimately drive a recovery. “Will price investment eventually payoff?” the analysts wrote.
Recent commentary from management at the Consumer Analyst Group of New York (CAGNY) conference highlighted ongoing category and brand-level challenges, which Jefferies said are supported by third-party tracked-channel data.
According to Nielsen data cited in the report, NAR volumes deteriorated sequentially in fiscal third quarter 2026, declining about 3% over the last 12 weeks ending February 21, compared with a 0.5% gain in the prior 12-week period. Trends worsened further in the latest four weeks, with volumes down roughly 5%.
Jefferies said it is forecasting NAR organic sales to fall approximately 5.7% in the third quarter.
The firm noted that management previously cut fiscal 2026 guidance ahead of CAGNY, pointing to a pressured US consumer who is increasingly purchasing on promotion, raising the cost of driving volume growth. Importantly, only four of General Mills’ top 10 brands showed improvement in the latest 12-week period versus the last six months, suggesting that recent shelf-price reductions across roughly two-thirds of the NAR portfolio have yet to produce the desired lift in volumes.
At CAGNY, the company also announced plans to rationalize about 20% of its lower-productivity cereal SKUs, a move Jefferies said underscores continued category challenges. The analysts added that “category and consumer pressures keep us cautious."
Beyond pricing, Jefferies pointed to broader headwinds, including weak consumer sentiment and pressures tied to SNAP benefits and GLP-1-related consumption shifts.
“Taken together with persistently weak consumer sentiment, category headwinds from SNAP and GLP-1, and the revised outlook, we believe the path to recovery for GIS is likely to be multi-year,” the analysts wrote, adding that the trajectory raises questions around capital allocation priorities and the magnitude of incremental investment needed to re-accelerate organic growth.
In the Pet segment, however, trends were more mixed. Tracked-channel retail sales improved sequentially, rising about 3% in the latest 12 weeks compared with 2% in the prior period. The acceleration was driven by a strong January, with sales up high-single digits, primarily volume-led, including notable gains from Blue Buffalo’s Life Protection Formula. Jefferies wrote that its research suggests that meaningful promotional activity in the pet specialty channel likely supported those results.
At the same time, the Wilderness brand continues to underperform, reinforcing what Jefferies described as the importance of a broader brand refresh that management has previously outlined. During CAGNY, management also highlighted the need for increased in-store sales force support to improve on-shelf availability for its Fresh products.