Good old-fashioned affordable canned soup is having a moment as inflation-weary shoppers trade down from bigger meals to save money.
The company's CEO says it's a sign of the times.
"I think in the moment we are in right now, the soup business really matches both the demand for consumers and the value that they are looking for," Campbell Soup CEO Mark Clouse said on Yahoo Finance Live (video above). "And as we have watched consumers navigate through tough inflation and the backdrop of a tougher economic environment, I think soup in many ways checks a lot of boxes for consumers right now."
Here are some other Yahoo Finance takeaways from Campbell Soup earnings:
Big quarter for soup sales ahead of peak winter demand.
Supply chain improvements leading to better in-stock positions are a welcome development.
The full-year sales and profit guidance raise is an added bonus.
Keep an eye on volume trends as CPB works to pass through further inflation.
Campbell Soup stock hit a one-year high in the wake of the results. Year to date, shares are up 30% compared to a 16% drop for the S&P 500.
The Street was generally pleased with Campbell's quarter and outlook.
"After a difficult fiscal 2022, Campbell has noticeably improved its supply chain which is supporting higher shipment growth and better realized productivity (3 percentage points plus)," EvercoreISI analyst David Palmer said in a note to clients. "Improved fulfillment is being supported by higher advertising spend (+30% year over year in fiscal first quarter). These factors plus improved pricing (roughly 11% in fiscal year 2023) relative to commodity inflation (up low double-digit percentage) should support the company’s earnings outlook."