Should Conagra Brands (CAG) Be a Staple of Your Portfolio?

Conagra Brands (NYSE: CAG) is one of the food giants of Wall Street, but in the last week or two some investors have been fearing the nutritional value it offers portfolios due to updated fiscal 2025 guidance, which noted temporary service constraints and exchange rate impacts.

The drop makes one wonder about CAG’s long-term prospects and how the company will respond to its challenges. Are these issues temporary, and is this a good buying opportunity for investors? Or is it a first step on a downward slope?

By our measurements, CAG is one to watch, but with reservations. Here’s why.

When this article was initially drafted on Tuesday, CAG enjoyed a Zen Rating of B, which placed it in the top 20% of stocks we cover. Stocks with a B rating had an average return of +19.88 per year. 

But things can change quickly for stocks — by Wednesday, it had dropped to a C (Hold), largely due to a drop in its Sentiment rating, from C to D. If you think back to term-paper grades in school, this would be the difference between an average and below average score. You don’t make the honor roll with below-average scores. 

So while CAG be worth watching due to its Value rating of B (indicating it’s undervalued compared to its earnings potential) and its Safety rating of A (indicating an excellent level of stability), that overall grade means investors should wait before investing. 

Happily, when a stock’s Zen Rating drops (or goes up), you can easily track it with our new Zen Ratings Upgrades and Downgrades feature.  

If a stock does lose its A or B rating as in the case of CAG, its ticker page offers suggestions for stocks in the sector to locate other high-potential picks.

This feature lets you quickly locate alternatives with a higher overall Zen Rating. In the case of CAG, here are three alternatives that also have above-average Safety ratings:

1- Lancaster Colony Corp. (NASDAQ: LANC)

This company, which produces a variety of foodstuffs from garlic bread to salad dressings and pasta for both retail and foodservice markets, earns an overall B (Buy) Zen Rating.

The Component Grades for LANC reveal two particular areas of strength: Safety, where it earns a B rating, and perhaps more interestingly, another above-average rating according to our AI factor, which analyzes patterns and relationships in vast amounts of data to forecast potential stock performance.

Although LANC is down slightly (just under 1%) year over year, it’s picked up momentum recently, gaining 9% in the past month alone, with analysts forecasting as much as 18% additional upside in the coming year. See the ratings

2- Pilgrims Pride Corp. (NYSE: PPC)

If this stock sounds familiar, it may be because we’ve discussed it before — in late December, we featured it as a top stock to watch, with an A (Strong Buy) Zen Rating. 

While PPC has dropped slightly into B territory, its prospects remain strong. Like LANC above, it earns above-average marks, ranking in the 91st percentile of stock we track for Safety; it also ranks in the 90th percentile for Momentum and the 93rd percentile for Financials, indicating a solid stock that still has room to grow. See forecasts and analyst ratings for PPC here

3- Ingredion Inc. (NYSE: INGR)

This company specializes in the unsung heroes of cooking: Starches and sweeteners. Perhaps you’d be surprised to see how many packaged foods these ingredients go into — or maybe upon viewing the stock’s fundamentals, it wouldn’t seem too surprising.

Creating shelf-stable products has led to stability for INGR; it earns an overall B (Buy) Zen Rating, and ranks in the top 90% of stocks we track for Safety. It also earns an A rating for the Financials component, indicating it’s a solid and stable stock all around. See analyst ratings for INGR here

If you’re less interested in a particular sector and more focused on Safety, you can use our Most Safe & Stable Stocks to Invest In screener to locate high-quality picks that score high for the Safety Component Grade of Zen Ratings. 

To do that and keep on top of relevant news, WallStreetZen Premium is your best option. It will provide you with all the fundamental information you need, an unlimited watchlist, and more. 

Want to get in touch? Email us at news@wallstreetzen.com.