Weak soup sales feed Campbell's sale rumors: Report
"We chose not to match" rivals' price cuts, says Campbell Soup CEO Conant.
Yet another slow Campbell Soup "soup season" will "raise further questions" about the company's "competitiveness" and its position vs macaroni and cheese, ramen and other "simple meals," writes Janney Capital Markets analyst Jonathan Feeney.
The company said today sales will fall 1 percent, and profits at least 6 percent, below Campbell's targets, when it reports quarterly earnings Nov. 23. Lame-duck president Douglas R. Conant blamed deep price cuts by competitors, "which we chose not to match."
Weak soup sales are extra embarrassing since company soup boss Denise Morrison is in line to replace Conant as chief executive, according to Feeney. Campbell soups are prominently displayed at Wal-Mart and other big stores. But the stuff still isn't moving like it's supposed to.
The bad news will likely "reignite speculation that the Board could explore strategic options for the company," or at least for its soup business, Feeney wrote.