Hormel Foods Corporation (HRL) Stock Analysis
Score BValue · Grade C · Bearish
$20.36
$21.28
+4.5%
7/10
C
Value
Investment Thesis
Price is above modeled value range. Quality supports holding but not attractive for new positions.
Trading near modeled fair value. No strong quantitative signal.
For New Investors
Price above modeled value range
For Current Holders
Quantitative score: neutral
Buy if
- Price drops 15-20% (improves asymmetry)
- Bull scenario catalysts materialize
- Market-wide correction creates opportunity
Sell if
- Bear scenario triggers occur
- Quality metrics deteriorate (ROIC declining)
- Better alternatives emerge
Valuation
Fair Value estimate: $21.28 (+4.5%). Slightly undervalued.
PEG-Based EPS
$21.83
FCF DCF Model
$26.46
EV/EBITDA
$13.27
Blended Fair Value
$21.28
Confidence
High
Methods
PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA
Quality Analysis
73/120 points
Investable
ROE (3Y Avg)
8.8%
ROIC-WACC Spread
-1.7%
D/E Ratio
0.4x
Current Ratio
2.5x
Interest Coverage
9x
FCF Positive Years
3/3
Quality Flags
- Low ROE: 8.8% (need >12%, got 12/20 pts)
- ROIC spread: -1.7pp (got 0/25 pts)
- Leverage: D/E 0.4x (11/15 pts)
Market Sentiment
Wall Street Consensus
$27.00
+32.6% Upside
8 analysts
Range: $25.00 — $30.00
Rating: Hold
Our model aligns with Wall Street consensus.
Trend & Technical
Price ($20.33) is 12.5% below SMA 200 ($23.23). Bearish trend. Caution on entry.
Tech Score 34/100 — Weak technicals. Bearish bias in trend or momentum.
Risk & Reward
Asymmetry Ratio
2.51:1
Expected Return
+8.3%
Bull Upside
+32.6%
Bear Downside
-13.0%
Good asymmetry: 2.51:1 ratio. Upside justifies risk.
Verdict: Favorable
Scenario Analysis
Bear
Base
Bull
Buy Zone & Action Plan
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AI Executive Summary
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Technical Analysis
RSI, MACD, moving averages, trend signals, and momentum indicators.
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Frequently Asked Questions
What is the fair value of HRL?
Based on our multi-method conviction analysis, the estimated fair value of Hormel Foods Corporation (HRL) is $21.28. This is calculated by blending PEG-Based EPS, FCF 2-Stage DCF, EV/EBITDA and applying a quality premium of 0% based on the company's fundamentals. The confidence level of this estimate is high.
Is HRL a buy, sell, or hold?
HRL currently has a HOLD rating with a conviction score of 7/10. Price is above modeled value range. Quality supports holding but not attractive for new positions. Price above modeled value range.
Is HRL a high-quality stock?
Hormel Foods Corporation has a quality grade of C (73/120 points), rated as Investable. Key metrics include ROE of 8.8%, ROIC-WACC spread of -1.7%, and D/E ratio of 0.4x.
What type of stock is HRL?
HRL is classified as a "value" in our framework. High dividend: 5.7%, Mature growth: -1.3%, Consistent FCF: 3/3 years positive
What do Wall Street analysts say about HRL?
8 Wall Street analysts have a consensus price target of $27.00 for HRL, representing +32.6% upside. Targets range from $25.00 to $30.00. The consensus recommendation is "Hold". Our model aligns with Wall Street consensus.
What are the risks of investing in HRL?
The risk/reward asymmetry ratio for HRL is 2.51:1, rated as Favorable. Good asymmetry: 2.51:1 ratio. Upside justifies risk. The expected return is +8.3%, with bull case upside of +32.6% and bear case downside of -13.0%.
What is the current trend for HRL?
HRL is in a bearish trend. Price ($20.33) is 12.5% below SMA 200 ($23.23). Bearish trend. Caution on entry. The technical score is 34/100.
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Last updated: May 19, 2026 · Framework version 3.7
This analysis is for informational purposes only and should not be considered financial advice. Always do your own research before making investment decisions.