Shrinkflation! What investors must know about Big Food’s troubles

Opening Bid

The packaged industry has a few problems at its doorsteps entering 2025. For starters, the industry continues to be under fire from lawmakers like Senator Elizabeth Warren for shrinking package sizes in a bid to boost profits. Secondarily, stubborn inflation continues to weigh on profit margins. Many households are struggling from paycheck to paycheck, causing them to forego buying some snacks and frozen meals. And last but not least, the rise of weight loss drugs in the mold of Ozempic is taking a toll on outlooks for food businesses – and investor sentiment. Yahoo Finance executive editor Brian Sozzi chats with BofA Securities Senior Food & Beverage Analyst Peter Galbo. The veteran analyst has long covered the packaged food industry, including household names such as Hormel and Campbell Soup. With margins under pressure and big food getting raked over the coals this election season, are there any reasons for investors to own these stocks? If so, what is the best bet on the future of packaged food?

Yahoo Finance's Opening Bid, brings you a high-octane take on the freshest analyst calls, wildest stock moves and shrewdest commentary in the business world. Executive Editor Brian Sozzi puts Wall Street's finest through their paces in this essential conversation for every investor - before the stock market opens.

Find this episode's transcripts and more episodes of Opening Bid at https://finance.yahoo.com/videos/series/opening-bid/.

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00:00-Peter Galbo joins Opening Bid

00:43-Consumers are fed up with shrinkflation

05:10-Tough choices at the grocery store

06:45-Convenience stores cooling

16:51-McCormick flavors

22:45-Investing tips in the world of snacks

Yahoo Finance's Opening Bid is hosted by Brian Sozzi, and produced by Rachael Lewis-Krisky.

Peter Galbo is BofA Securities' Senior Food & Beverage Analyst focusing on consumer relationship and behaviors with the food sector.

Peter Galbo disclosures for companies mentioned in episode:

Hormel Foods: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: No

Mondelez Int: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: Yes

Kraft Heinz: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: Yes

Conagra: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: Yes

Campbell Soup: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: No

McCormick: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: No

JM Smucker Company: Investment relationship: Yes | Individual owns: No | Family owns: No | Company owns: No

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