Hormel Foods: A Contrarian Buy-and-Hold Opportunity Amid Struggles

Hormel Foods, a Dividend King with a historically high 4.7% yield, has seen its stock plummet roughly 55% from all-time highs. The consumer staples giant is grappling with declining volumes and rising costs, yet long-term shareholders remain bullish. Despite being the worst-performing holding in some portfolios, the stock's DEEP undervaluation presents a compelling entry point for patient investors.

The company's branded food portfolio has underperformed, with fiscal 2025 volumes dropping 2.5% year-to-date. Price increases drove a modest 1.9% sales bump, but margin compression persists. Strategic tax-loss harvesting opportunities exist for current holders, provided they navigate wash-sale rules carefully. Market sentiment suggests any turnaround will be gradual, eliminating fears of missing a sudden rally.