12:55 PM EDT, 06/05/2026 (MT Newswires) -- US food producers including General Mills ( GIS ) and J.M. Smucker ( SJM ) may see their fiscal 2027 earnings missing consensus estimates amid rising input costs, Morgan Stanley said in a note emailed Friday.

The brokerage lowered 2027 earnings-per-share estimates for the two companies, as well as for Conagra Brands ( CAG ) and Campbell's (CPB).

"Heading into off-cycle earnings over the next several weeks, the focus is squarely on (fiscal 2027) outlooks -- both in terms of formal guidance for (J.M. Smucker ( SJM ), General Mills ( GIS ), and Conagra), as well as any incremental commentary from (Campbell's) -- with negative revisions generally expected amid ongoing topline weakness and incremental margin pressure from higher input costs post the Iran conflict," according to the Morgan Stanley report.

Wholesale costs rose at the fastest pace in four years in April as broad-based increases in services and goods signaled intensifying inflation pressures, data released last month showed.

Morgan Stanley now projects 2027 EPS of $1.41 for Conagra, $2.02 for Campbell's, $2.97 for General Mills ( GIS ) and $9.74 for J.M. Smucker ( SJM ). The consensus estimates are $1.63, $2.11, $3.20 and $9.92, respectively.

Morgan Stanley lowered its price targets to $13 from $15 for Conagra, $21 from $23 for Campbell's and $32 from $37 for General Mills ( GIS ). It raised J.M Smucker's ( SJM ) price target to $106 from $104.

"While there has been some recent sequential improvement in scanner trends as of late, visibility into durability remains low given a choppier macro backdrop," the report said. "At this point, (J.M Smucker ( SJM )) likely screens best, supported by solid recent trends, albeit with some uncertainty around coffee elasticities."

The brokerage said market share trends remain weak for General Mills ( GIS ), which has "limited flexibility after leaning into price to stabilize volumes." Conagra is more exposed to the low-end consumer hit hard by inflation.

"We would put (Campbell's) somewhere in the middle -- near-term trends remain weak, but with new leadership in snacks, there is at least some potential for strategic changes to support improvement," Morgan Stanley said.

Campbell's is scheduled to release its fiscal third-quarter results on Monday, while J.M. Smucker ( SJM ) will post its fourth-quarter financials on Tuesday. General Mills ( GIS ) reports on July 1, followed by Conagra on July 9.

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