General Mills Divests Häagen-Dazs China Shops and Braces for Steep Earnings Drop as Wall Street Turns Bearish
05.06.2026 - 18:10:13 | boerse-global.de
General Mills is undertaking a sweeping strategic overhaul as its stock languishes near 52-week lows, with the company offloading its Chinese Häagen-Dazs retail network, installing new leadership in its largest European market, and watching Wall Street slash price targets across the board. The moves come as the packaged-food giant grapples with a deep earnings slide and shifting consumer habits.
The US conglomerate has sold its Häagen-Dazs ice cream shops on the Chinese mainland to an investor group led by Ningji, a well-known local tea brand. The buyer receives an exclusive license to operate the stores and the brand’s gift business in the region. At its peak in 2019, the chain boasted more than 550 locations, but by May 2026 that number had dwindled to around 171. General Mills will retain the higher-margin supermarket and foodservice operations in China, which require less capital intensity.
Separately, Erasmo Nuzzi has been appointed head of the UK and Ireland division — General Mills’ biggest market in the EMEA region. The 23-year company veteran, who most recently served as marketing director for North America and previously ran the Iberian business from 2015 to 2022, takes over immediately after the close of fiscal 2025, which saw the group book total revenue of $19 billion.
Analyst sentiment has soured sharply. The Bernstein SocGen Group downgraded General Mills to “Underperform” and slashed its price target from $44 to $31, pointing to the failure of a three-percent price cut over the past 18 months to revive North American retail sales. Macro headwinds — including elevated oil prices inflating freight, agricultural inputs, and packaging costs — are compounding margin pressure. A shift in consumer behavior tied to GLP-1 weight-loss drugs and new health trends is also weighing on demand.
Should investors sell immediately? Or is it worth buying General Mills?
Other major banks have followed suit. Goldman Sachs rates the stock “Neutral” with a $36 target, while Bank of America lowered its target from $42 to $36, also at “Neutral.” UBS set a “Sell” rating with a $30 target, and JPMorgan cut its price objective to $31. Piper Sandler remains “Overweight” but has trimmed its earnings estimates for fiscal 2026 and 2027. Short interest has climbed more than 17% and now represents roughly 8.67% of the free float.
The company’s own guidance underscores the malaise. Management forecasts organic sales to decline between 1.5% and 2.0%, while operating profit and earnings per share are expected to plunge 16% to 20% in the current fiscal year. Looking further ahead, analysts project a roughly 6% drop in EPS for the next fiscal year as well.
Despite the turmoil, the balance sheet offers some cushion. Cash reserves swelled from $521.3 million to $785.5 million over the past year, while long-term debt fell to just under $11 billion. The dividend yield has surged past 7%, underpinned by more than five decades of uninterrupted payouts. The projected free cash flow of $3.28 per share handily covers the planned $2.44 per share dividend.
General Mills at a turning point? This analysis reveals what investors need to know now.
To retain top talent during the turnaround, the board has awarded retention grants: CFO Kofi A. Bruce received stock packages worth $3.5 million and digital chief Jaime Montemayor got $2.5 million. The bonuses, allocated on June 5, 2026, are subject to a three-year lock-up, with forfeiture if either executive retires before June 2028.
Technically, the stock is deeply oversold. The relative strength index stood at 29.2 in the primary source and 27.3 in another reading, with shares recently trading near €28 and just above the 52-week trough of €27.35. The next big test comes in July 2026, when General Mills reports fiscal fourth-quarter and full-year results — a reckoning that will show whether the pricing strategy is finally gaining traction or whether further margin erosion lies ahead.
Ad
General Mills Stock: New Analysis - 5 June
Fresh General Mills information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
