Campbell's Company (The)

Strategically, management acquired Sovos (Rao’s, Michael Angelo’s) for roughly 2.7 billion dollars to lift secular growth and premium mix, then divested non-core Pop Secret and noosa to sharpen focus.

The company raised its multiyear cost-savings target to 375 million dollars by FY28 and continues to invest in network optimization, including facility changes and productivity. Capital returns remain dividend-led with modest, largely anti-dilutive buybacks. The trade-off has been higher leverage and interest cost near term.

We view Sovos as industrially sound, but the price and financing push leverage above our preferred range; the subsequent move to buy 49% of La Regina aligns supply and quality for Rao’s. Execution of savings and debt paydown will determine long-run ROIC accretion.

Citations: Sovos close, Pop Secret sale, noosa sale, cost-savings target, La Regina stake.