Smithfield Foods Inc (SFD)

Price$21.97Cached quoteAs of 2026-09-05 13:37 UTC

AI: Undervalued

Price checkThe shares look undervalued if recent earnings settle well above the 2023 trough.

At the observed market price, Smithfield's equity is worth about $8.7 billion. That is roughly 8.1 times trailing net income and 10.8 times trailing free cash flow, meaning cash left after operations and capital spending. Even using average net income from 2022-2025, including the near-break-even 2023 year, the price is about 12.3 times earnings. The annual dividend rate implies a yield near 5.7%. Those figures leave room for some profit normalization, supporting an Undervalued verdict rather than requiring continued record results.

Big pictureProfits recovered sharply, but pork cycles make today's strong earnings less dependable than sales.

Revenue moved from $16.2 billion in 2022 to $14.6 billion in 2023, $14.1 billion in 2024, and $15.5 billion in 2025, while net income swung from $870 million to just $17 million, then rebounded to $953 million and $987 million. First-half 2026 net income reached $484 million, up 17.6% year over year, even as sales slipped 0.8%. That history shows the core issue: demand is relatively steady, but hog and pork economics can move profits dramatically. The latest guidance cut reinforces that cyclicality.

Business strengthLow debt and strong brands provide protection, though dividends and stock awards consume some cushion.

At June 2026, Smithfield reported $1.35 billion of cash and about $2.00 billion of total debt and finance leases, including current maturities. Net debt was about $654 million, only 0.4 times adjusted cash operating profit before interest, taxes, depreciation and amortization. Current assets were about $5.0 billion versus $2.0 billion of current liabilities. The dividend rate costs roughly $492 million yearly, about 46% of trailing net income and 61% of trailing free cash flow. The 2025 public offering increased shares about 3.4%, while employee stock awards create some additional dilution risk.

What could change the storySteadier branded-meat profits would support upside; weaker guidance or heavy project spending would challenge it.

The bull case is that Packaged Meats holds roughly 12%-13% operating margins, meaning operating profit as a share of sales, while Nathan's Famous adds permanent brand rights and Sioux Falls eventually lowers costs. The bear case is another forecast cut while large investments absorb cash. Smithfield now expects $1.225-$1.375 billion of 2026 adjusted operating profit. Nathan's could require roughly $450-$500 million, while Sioux Falls is estimated at up to $1.3 billion over three years. The valuation works if normalized earnings remain near or above roughly $700 million and those investments earn acceptable returns.

AI: News

Guidance cut after Q2Smithfield beat quarterly expectations but lowered its full-year sales and profit outlook, signaling tougher conditions ahead.

On August 11, Smithfield reported $3.7 billion of quarterly sales and adjusted earnings of $0.62 per share, slightly above analyst estimates. It cut expected 2026 sales growth to roughly flat from low-single-digit growth and lowered adjusted operating profit guidance by $100 million at both ends to $1.225-$1.375 billion. Reuters reported the shares were down about 3% in premarket trading. The timing supports investor concern about weaker expectations, although price movement alone does not prove the guidance change caused the decline.

Cost warning hit sharesStrong first-quarter results were overshadowed by warnings that energy costs could squeeze packaged-meat profits.

On April 28, Smithfield reported first-quarter sales of $3.8 billion and adjusted earnings of $0.64 per share, both above estimates, while keeping its full-year outlook unchanged. Management warned that higher diesel and packaging-resin costs tied to the Middle East conflict were pressuring Packaged Meats. Reuters reported the shares fell about 8% that day. The reaction was consistent with concern that rising costs could erode profitability, but the exact share move cannot be attributed to one statement with certainty.

Record year and dividend raiseRecord 2025 profits and a higher dividend strengthened the case that recent cash generation can persist.

On March 24, Smithfield reported fiscal 2025 operating profit of about $1.29 billion and raised its planned annual dividend to $1.25 per share from $1.00 paid in 2025. It also initially guided to low-single-digit 2026 sales growth and adjusted operating profit of $1.325-$1.475 billion. Reuters reported the shares rose about 5% in morning trading after the results and outlook. That reaction likely reflected stronger earnings expectations and cash returns, although later guidance cuts have weakened part of that bullish signal.

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Financial statements

	2025	2024	2023	2022	2015	2014	2013 · Dec 29	2013 · Apr 28	2012	2011	2010	2009
Revenue	$15.53B	$14.14B	$14.64B	$16.20B	$14.44B	$15.03B	$13.90B	$13.22B	$13.09B	$12.20B	$11.20B	$12.49B
Gross profit	$2.09B	$1.90B	$889.0M	$1.50B	$1.76B	$1.78B	$1.21B	$1.32B	$1.55B	$1.71B	$730.1M	$624.6M
Gross margin	13.45%	13.41%	6.07%	9.23%	12.16%	11.81%	8.67%	9.98%	11.83%	14.05%	6.52%	5.00%
Research & development	$214.0M	$144.0M	$175.0M	$157.0M	—	—	—	$80.9M	$75.9M	$47.0M	$38.8M	—
Operating expenses	$797.0M	$779.0M	$945.0M	$378.0M	$961.6M	$844.0M	$866.5M	$800.4M	$826.8M	$619.1M	$667.3M	$848.5M
Operating income	$1.29B	$1.12B	−$56.0M	$1.12B	$793.8M	$931.6M	$338.5M	$519.3M	$722.6M	$1.09B	$62.8M	−$223.9M
Operating margin	8.32%	7.91%	−0.38%	6.90%	5.50%	6.20%	2.44%	3.93%	5.52%	8.97%	0.56%	−1.79%
EBITDA	$1.62B	$1.46B	$371.0M	$1.56B	—	—	—	$759.2M	$965.4M	$1.33B	$305.1M	$46.6M
EBITDA margin	10.46%	10.30%	2.53%	9.61%	—	—	—	5.74%	7.37%	10.87%	2.72%	0.37%
Net income	$987.0M	$953.0M	$17.0M	$870.0M	$452.3M	$556.1M	$120.7M	$183.8M	$361.3M	$521.0M	−$101.4M	−$198.4M
Net profit margin	6.36%	6.74%	0.12%	5.37%	3.13%	3.70%	0.87%	1.39%	2.76%	4.27%	−0.91%	−1.59%
Basic EPSper basic share	$2.52	$2.51	$0.05	$2.29	—	—	—	$0.00	$0.00	$0.00	-$0.00	-$0.00
Diluted EPSper diluted share	$2.51	$2.51	$0.05	$2.29	—	—	—	$0.00	$0.00	$0.00	-$0.00	-$0.00

Review official source filings ↗

Owners

Reported shareholders

Reference date Jun 30, 2026

≈92.57%of listed shares

WH Group Ltd/ADR364.5M shares · Apr 8, 2025

View holders

Top 20 reported holders of SFD
Holder	% owned
WH Group Ltd/ADR	≈92.57%364.5M shares
WH Group Ltd	≈86.86%342.04M shares
LSV ASSET MANAGEMENT	≈1.81%7.11M shares
Wan Long	≈1.29%5.06M shares
TWO SIGMA INVESTMENTS, LP	≈1.08%4.24M shares
AQR CAPITAL MANAGEMENT LLC	≈1.04%4.11M shares
FMR LLC	≈0.74%2.91M shares
GOLDMAN SACHS GROUP INC	≈0.58%2.28M shares
DIMENSIONAL FUND ADVISORS LP	≈0.43%1.69M shares
Assenagon Asset Management S.A.	≈0.40%1.56M shares
BlackRock, Inc.	≈0.35%1.37M shares
Qube Research & Technologies Ltd	≈0.32%1.24M shares
UBS Group AG	≈0.30%1.17M shares
Fourth Sail Capital LP	≈0.27%1.07M shares
Gotham Asset Management, LLC	≈0.26%1.04M shares
MILLENNIUM MANAGEMENT LLC	≈0.24%926.61K shares
JACOBS LEVY EQUITY MANAGEMENT, INC	≈0.21%836.45K shares
COHEN & STEERS, INC.	≈0.21%820.35K shares
BANK OF AMERICA CORP /DE/	≈0.21%818.43K shares
MORGAN STANLEY	≈0.20%805.39K shares

Percentages use 393.76M shares of this listed class outstanding on Jun 28, 2026. ≈ compares the latest reported holding with a share total from a different date; it is not a confirmed current stake.

Reported positions exceed 100% in total, so the circle shows the selected holder only.

Source: SEC Form 4 ↗Updated Sep 29, 2026 · Quarterly data

Insider buys & sells

Jul 1, 2024–Jun 30, 2026

Buys18$108.43M disclosed value

Sells (SEC code S)6$837.64M disclosed value

Transaction	Insider	Type	Shares	Price	Value	Owned after
Jun 16, 2026Form 4	France StevenPresident, Packaged Meats	SellCommon Stock	82.8K	$26.82	$2.22M	145.4K
Jun 12, 2026Form 4	Starling Raymond ADirector	SellCommon Stock	4.0K	$26.78	$106.0K	12.0K
Jun 9, 2026Form 4	Hall Mark L.Chief Financial Officer	SellCommon Stock	78.6K	$26.36	$2.07M	134.7K
Sep 8, 2025Form 4	France StevenPresident, Packaged Meats	BuyCommon Stock, no par value	2.5K	$23.25	$58.1K	70.0K
Sep 8, 2025Form 4	Hall Mark L.Chief Financial Officer	BuyCommon Stock, no par value	2.0K	$23.25	$46.5K	72.0K

Review ownership filings at SEC.gov ↗

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Smithfield Foods Inc (SFD)

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