Chicago - ConAgra Inc shares fell by more than 10% on Tuesday amid a wave of analyst downgrades triggered by a company statement Friday that it would not meet its double-digit earnings growth target for fiscal 1998.
Merrill Lynch, J.P. Morgan Securities, Rodman & Renshaw, Dain Rauscher and Schroders all downgraded the food company Tuesday, and estimates for both fiscal 1998 and fiscal 1999 earnings were cut.
ConAgra said in its statement that its earnings outlook had been hurt by recent deterioration and depressed margins in the fresh meat and poultry industry.
Merrill Lynch analyst Leonard Teitelbaum said, "We feel this situation will eventually rectify itself, but it may take until the middle of next year to see the turn."
ConAgra also said Asian demand for meat and poultry was down sharply, which will further erode earnings.
The earnings announcement came just one day after ConAgra said Kevin LaFleur, president of its Monfort Beef and Lamb Co, had left the company.
Rodman & Renshaw said it did not expect the stock price to start to recover until there is some indication that the beef and poultry segments are rebounding or at least until ConAgra has appointed a new head of beef operations.
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