Food makers adjust to changing tastes

Article Excerpt

As consumers shift to healthier foods, these two Consumer-sector companies are adjusting their products and cutting their costs. That should help protect their dividends. CAMPBELL’S CO. $39 is a buy. The company (Nasdaq symbol CPB; Conservative-Growth Payer Portfolio, Consumer sector; Shares outstanding: 298.1 million; Market cap: $11.6 billion; Dividend yield: 4.0%; Dividend Sustainability Rating: Above Average; www.thecampbellscompany.com) makes soups, sauces and snack foods. With the January 2025 payment, Campbell’s will raise your quarterly dividend by 5.4%, to $0.39 a share from $0.37. The new annual rate of $1.56 yields 4.0%. In March 2024, the company completed its $2.9 billion acquisition of Sovos Brands Inc. (Nasdaq symbol SOVO), the maker of Rao’s pasta sauces. As a result of that purchase, Campbell’s sales in its fiscal 2025 second quarter, ended January 26, 2025, rose 9.3%, to $2.69 billion from $2.46 billion a year earlier. If you exclude businesses that Campbell’s bought and sold, sales fell 1.8%. Earnings before unusual items declined 7.5%, to $0.74 a share (or a total…