Research Update: Conagra Brands Inc. Outlook Revised To Negative On Lowered Guidance For Fiscal Year 2020, Ratings Affirmed

U.S.-based Conagra Brands Inc. lowered its guidance for fiscal year 2020 due to its disclosure for softer-than-expected performance in the third quarter. Specifically, the company now believes it will see lower organic sales and profits for the year than it previously anticipated. We said in January 2020 that a negative rating action could occur in the next few months if Conagra's innovation falls short, resulting in sales and adjusted EBITDA below our forecast. Therefore, we are revising our outlook on Conagra to negative from stable and are affirming all of our ratings on the packaged food company, including our 'BBB-/A-3' issuer credit rating. The negative outlook reflects the potential for a lower rating over the next 12 months if we

...- U.S.-based Conagra Brands Inc. lowered its guidance for fiscal year 2020 due to its disclosure for softer-than-expected performance in the third quarter. Specifically, the company now believes it will see lower organic sales and profits for the year than it previously anticipated. - We said in January 2020 that a negative rating action could occur in the next few months if Conagra's innovation falls short, resulting in sales and adjusted EBITDA below our forecast. - Therefore, we are revising our outlook on Conagra to negative from stable and are affirming all of our ratings on the packaged food company, including our '###-/A-3' issuer credit rating. - The negative outlook reflects the potential for a lower rating over the next 12 months if we unfavorably revise our view of the company's business risk profile, or if we believe the company will not be able to improve credit ratios in line with our base-case forecast, which includes reducing adjusted leverage below 4.5x by the beginning...

Research Update