The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Lamb Weston (NYSE: LW) and the rest of the shelf-stable food stocks fared in Q2.

As America industrialized and moved away from an agricultural economy, people faced more demands on their time. Packaged foods emerged as a solution offering convenience to the evolving American family, whether it be canned goods or snacks. Today, Americans seek brands that are high in quality, reliable, and reasonably priced. Furthermore, there's a growing emphasis on health-conscious and sustainable food options. Packaged food stocks are considered resilient investments. People always need to eat, so these companies can enjoy consistent demand as long as they stay on top of changing consumer preferences. The industry spans from multinational corporations to smaller specialized firms and is subject to food safety and labeling regulations.

The 20 shelf-stable food stocks we track reported a mixed Q2. As a group, revenues beat analysts’ consensus estimates by 1.3% while next quarter’s revenue guidance was in line.

While some shelf-stable food stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 3.5% since the latest earnings results.

Lamb Weston (NYSE: LW)

Best known for its Grown in Idaho brand, Lamb Weston (NYSE: LW) produces and distributes potato products such as frozen french fries and mashed potatoes.

Lamb Weston reported revenues of $1.68 billion, up 4% year on year. This print exceeded analysts’ expectations by 5.7%. Overall, it was a very strong quarter for the company with an impressive beat of analysts’ EBITDA and organic revenue estimates.

“Lamb Weston returned to growth in the second half of the year with momentum in customer wins and retention, delivering financial results above our updated expectations,” said Mike Smith, Lamb Weston president and CEO.

Lamb Weston achieved the biggest analyst estimates beat of the whole group. Unsurprisingly, the stock is up 13.7% since reporting and currently trades at $55.88.

Is now the time to buy Lamb Weston? Access our full analysis of the earnings results here, it’s free.

Best Q2: Hershey (NYSE: HSY)

Best known for its milk chocolate bar and Hershey's Kisses, Hershey (NYSE: HSY) is an iconic company known for its chocolate products.

Hershey reported revenues of $2.61 billion, up 26% year on year, outperforming analysts’ expectations by 3.1%. The business had an exceptional quarter with an impressive beat of analysts’ EBITDA and organic revenue estimates.

Hershey pulled off the fastest revenue growth among its peers. However, the results were likely priced into the stock as it’s traded sideways since reporting. Shares currently sit at $186.

Is now the time to buy Hershey? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Conagra (NYSE: CAG)

Founded in 1919 as Nebraska Consolidated Mills in Omaha, Nebraska, Conagra Brands today (NYSE: CAG) boasts a diverse portfolio of packaged foods brands that includes everything from whipped cream to jarred pickles to frozen meals.

Conagra reported revenues of $2.78 billion, down 4.3% year on year, falling short of analysts’ expectations by 1.7%. It was a disappointing quarter as it posted full-year EPS guidance missing analysts’ expectations.

Conagra delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 4.8% since the results and currently trades at $19.38.

Read our full analysis of Conagra’s results here.

J&J Snack Foods (NASDAQ: JJSF)

Best known for its SuperPretzel soft pretzels and ICEE frozen drinks, J&J Snack Foods (NASDAQ: JJSF) produces a range of snacks and beverages and distributes them primarily to supermarket and food service customers.

J&J Snack Foods reported revenues of $454.3 million, up 3.3% year on year. This result surpassed analysts’ expectations by 2%. Overall, it was a very strong quarter as it also logged an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ adjusted operating income estimates.

The stock is down 7.1% since reporting and currently trades at $107.10.

Read our full, actionable report on J&J Snack Foods here, it’s free.

Kellanova (NYSE: K)

With Corn Flakes as its first and most iconic product, Kellanova (NYSE: K) is a packaged foods company that is dominant in the cereal and snack categories.

Kellanova reported revenues of $3.20 billion, flat year on year. This number was in line with analysts’ expectations. However, it was a slower quarter as it recorded a miss of analysts’ gross margin estimates and a miss of analysts’ EBITDA estimates.

The stock is down 1.4% since reporting and currently trades at $78.72.

Read our full, actionable report on Kellanova here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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