Why J.M. Smucker Stock Just Got Crushed - The Bitter Truth Behind Today’s Plunge

Another legacy food giant gets served a reality check.

J.M. Smucker just joined the club of traditional consumer staples getting absolutely hammered by market forces—and it’s not pretty. The numbers don’t lie, and neither do the charts. While crypto and decentralized finance keep eating the world, old-school packaged goods are getting left behind.

Earnings Miss? More Like a Full-Blown Strikeout.

Revenue dropped. Guidance got slashed. Margins compressed. Sound familiar? It’s the same story we’ve seen play out across the sector—companies that can’t adapt to digital-first consumers and agile supply chains are getting punished. Hard.

Meanwhile, Over in Crypto-Land…

As Smucker struggles to preserve jam jar margins, decentralized food tokens and blockchain-based supply chain platforms are quietly revolutionizing how people think about consumption. But hey—at least they still have those cute little peanut butter jars, right?

Final Take: Sometimes the market doesn’t just want a snack—it wants disruption. And today, Smucker’s shareholders got crumbs.

A tariff-related miss leaves a bitter taste

In the fiscal third quarter, J.M. Smucker's revenue declined 1% to $2.1 billion, although absent the effect of divestitures over the past year, revenue WOULD have actually increased 2%. On a more pessimistic note, adjusted (non-GAAP) earnings per share of $1.90 fell a more severe 22% from the prior year. Both top and bottom lines missed expectations.

But while the quarter came in a bit soft, management actually increased full fiscal year guidance, now expecting full-year revenue to grow between 3% to 5%, compared with 2% to 4% previously. While the earnings-per-share range with $9.00 per share at the midpoint was left unchanged, management also raised guidance for free cash FLOW by $100 million to $975 million.

The free cash Flow uplift was nice to see, but was actually the result of tax benefits in the recently passed "big, beautiful bill." Meanwhile, revenue gains are coming from price hikes, especially on coffee, in response to increased commodity prices, which have been affected by recent tariffs.

Image source: Getty Images.

Tariffs are clearly biting Smucker's profits

While Smucker appears to be raising prices with some success, it doesn't appear the increases are totally compensating for higher commodities and tariff impacts, as evidenced by the decline in earnings. This is especially true in the coffee segment, which makes up about a third of revenue and is the company's largest. Unfortunately, that's where tariffs on green coffee are hurting the most. And the tariff effect will get bigger because President TRUMP decided to institute a 50% tariff on Brazil at the end of July.

Still, shares trade for a low valuation, at just 11.5 times this year's free-cash-flow guidance with a healthy 4% dividend yield. Assuming tariffs are a one-time cost, and that's not a demanding valuation for investors.