Market Intelligence Center  Nov 9  Comment 
MarketIntelligenceCenter.com’s patented algorithms have chosen the Jan. '16 $40.00 call for a couple of hedged-trading ideas on ConAgra Foods Inc. (CAG). A traditional covered call on ConAgra Foods yields 3.79% (20.64% annualized, for comparison...
Market Intelligence Center  Nov 4  Comment 
ConAgra Foods Inc. (CAG) traded between $40.51 and $41.13 before closing at $40.96 Tuesday and presents some attractive trading opportunities today according to MarketIntelligenceCenter.com's patented algorithms. The computer program that picks...
New York Times  Nov 2  Comment 
The sale to TreeHouse Foods will allow ConAgra to focus on its brands, which includes names such as Healthy Choice and Orville Redenbacher’s.
Benzinga  Nov 2  Comment 
Dyax Corp. (NASDAQ: DYAX) shares climbed 33.49 percent to $36.75 in pre-market trading after the company agreed to be acquired by Shire PLC (ADR) (NASDAQ: SHPG) for $5.9 billion. Constant Contact Inc (NASDAQ: CTCT) shares surged 22.61...
MarketWatch  Nov 2  Comment 
ConAgra shares surge 20% after deal with TreeHouse
Market Intelligence Center  Oct 29  Comment 
ConAgra Foods Inc. (CAG) was selected by MarketIntelligenceCenter.com’s trade-picking algorithms today after trading between $40.04 and $40.86 on Wednesday before closing at $40.44. A diagonal spread using a long position in the Jan. '17 $28.00...
newratings.com  Oct 24  Comment 
WASHINGTON (dpa-AFX) - Packaged foods company ConAgra Foods, Inc. (CAG) announced that DAVID Trail Mix Sweet & Salty flavor is voluntarily recalled due to presence of an ingredient in the trail mix that contains milk protein, which is not declared...
Reuters  Oct 22  Comment 
TreeHouse Foods Inc is in advanced talks to acquire Ralcorp, the private label business of ConAgra Foods Inc , in a deal that could be valued between $2.5 billion and $2.7 billion,...
Market Intelligence Center  Oct 20  Comment 
Monday’s trading in ConAgra Foods Inc. (CAG) gives options traders an opportunity for a 5.69% return. By selling the Dec. '15 $41.00 call and buying the Jan. '17 call at the $28.00 level for a net debit of $12.30, traders will book a profit as...


ConAgra Foods (NYSE: CAG) is a major manufacturer, packager, and distributor of consumer and commercial food products. It owns and operates brands such as Healthy Choice, Chef Boyardee, Hunt’s, Orville Redenbacher’s, Reddi-Wip, Slim Jim, and Hebrew National.[1]

ConAgra holds a portfolio of well-recognized brands, and is increasing sales of these items through an increased advertising budget. With high brand awareness, ConAgra products command a large percentage of shelf space at both traditional and low-cost retailers, which further drives recognition and sales. The company earned $12 billion in revenue and $726 million in net income in 2010.[2] with a market share of 13% in frozen snacks

However, many of these brands are high-fat or snack foods, and ConAgra will have to address shifts in consumer commodities.

Company Overview

ConAgra's products fall into the following categories:[3]

International Foods

Contributing only five percent to total sales, ConAgra sells many brands in the global market. The majority of international sales come from Canada and Mexico.

Ongoing Changes to ConAgra's Business Plan

In 2003, ConAgra introduced a plan to integrate its businesses and improve profitability. As a large, cohesive company, ConAgra would be more efficient and better able to compete with competitors who are integrated packagers.

The following are what this strategic plan consists of:


ConAgra sold all businesses that were either too complex to integrate with the core businesses or did not achieve a profit margin greater then ConAgra's benchmark margin rate. Notable spin-offs include: Butterball, Armour, LunchMakers, and Louis Kemp Seafood.

Cost Savings

ConAgra plans to cut co


The company plans on spending more on advertising in general to elevate sales. ConAgra will prioritize advertising funds on the brands that make-up the largest portions of sales, which have not seen strong advertisement campaigns in years. On the other hand, this directional move in advertisement will take dollars away from the less well-known brands and sales will drop amongst those products.

Brand Awareness

In ConAgra's consumer goods business, there is no one factor more important then brand awareness. How well do customers recognize your brand? If a customer recognizes your brand they are more likely to buy it, increasing that product's sales. Products are shelved in stores according to their popularity among customers (the most sales). If your product is selling for the stores, it will be placed in areas where even more customers will see and buy it. In addition, when you change a product, if your product is well placed within stores, that change will be more quickly recognized by the customers.

In recent years, ConAgra has focused much of its marketing campaign on their lower priority (less well-known) brands in order to gain brand awareness in those products' audiences. This strategy proved to not be as profitable as ConAgra had hoped and let higher priority brands lose brand awareness as marketing dollars were taken away from them. The market sentiment is that ConAgra needs to develop new, innovative products in order to maintain its position in the market amongst this audience.

ConAgra's new advertising campaign should increase brand awareness amongst their products and get products better placement in the stores. This is especially the case for brands that have lost shelf space in previous years while ConAgra has been focusing on its smaller brands.

It should be noted that overall many of ConAgra's products are not within the top three known brands in their product category, but when it come to[value-oriented customers they are the most recognizable. Hence, they have the highest sales numbers and best shelf placement in stores like Wal-Mart.

Articles like this rellay grease the shafts of knowledge.

Trends and Force

Dietary Trends

To read a more detailed discussion of consumer health trends, see also Health and wellness.

Dietary trends in the United States are becoming healthier and a social push for increased health consciousness is apparent. Most of ConAgra's products are not considered healthy, with many falling in the categories of snack food, high-fat, high sugar and highly processed. Many believe this may be an issue for ConAgra in terms of staying competitive in the long-term.

Some of ConAgra's research and development is focused on this ongoing trend. They have already made some changes, i.e. offering "light" versions of some snacks. In a recent paper ConAgra self-reported that it has made improvements regarding transfats, sugar, and salt in its brands.

Public Perceptions and Health Scares

Food companies are very sensitive to contamination issues because these issues can scare the public and damage consumer loyalty and trust. However, it should be noted that this might be less of the case with ConAgra because they market their products under individual brand names.


ConAgra has a strong position amongst its competitors in terms of market share. In this chart the proxy for this number is the total number of sales by the company in the last twelve months (TTM Total Sales). ConAgra has less market share then Kraft, more then Hormel Foods, and about the same as General Mills. Some may consider this impressive because ConAgra has yet to gain market share in the international market while Kraft and others have.

ConAgra's margin, the percentage of each sale that becomes profits, is relatively low when compared to competitors. Margin is known as a good measure of profitability but could also be a signal about who ConAgra's customers are, i.e. they may be looking for the best deal and, by taking less of a profit, ConAgra attracts them to their products.


  1. CAG 2010 10-K "General Development of Business" pg. 1
  2. CAG 2010 10-K "Narrative Description of Business" pg. 3-4
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