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Campbell's (CPB) Backs Manufacturing Skills Push As Investors Weigh Whether Shares Look Cheap

Simply Wall St · 2d ago

Campbell's (CPB) is backing a new skills push, committing US$500,000 to partner with Per Scholas on an Advanced Manufacturing Technician program in Greater Milwaukee that targets labor shortages in industrial roles.

For shareholders, the picture has been tougher than this workforce story suggests. Campbell's last closed at US$19.10, with the 1 month share price return down 10.12% and the year to date share price return down 31.07%, while the 1 year total shareholder return declined 32.60% and the 5 year total shareholder return fell 43.42%.

Scan beyond Campbell's and see how other manufacturers that are tackling automation and skilled labor gaps are trading with our curated list of 32 resilient stocks with low risk scores today.

After a slide of more than 30% over the past year, Campbell's now trades meaningfully below both analyst targets and some intrinsic value estimates. Is the recent drop enough to close that valuation gap?

Most Popular Narrative: 8% Undervalued

Campbell's last traded at $19.10, which is below the most widely followed fair value estimate of $20.79 that uses a 7.6% discount rate and incorporates detailed earnings and margin assumptions.

The main factor that needs to go right is that Campbell's delivers the planned US$500 million cost saving program and productivity gains without disrupting operations or weakening the core snacks and meals franchises.

The numbers indicate that Campbell's share price already reflects a fairly valued, cautiously positive view that cost savings, pricing and deleveraging will balance ongoing inflation and snacks weakness over time.

See why 41 investors see Campbell's as 8% undervalued.

Result: Fair Value of $20.79 (UNDERVALUED)

Still, the story breaks quickly if input and logistics inflation bite harder than expected, or if ongoing snacks volume pressure persists despite Campbell's cost program.

Find out about the key risks to this Campbell's narrative.

Next Steps

Sentiment on Campbell's is clearly mixed, with both caution and optimism in play. Act quickly by reviewing the full picture for yourself in the 2 key rewards and 4 important warning signs.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.