Is CPB a good stock to buy? We came across a bullish thesis on The Campbell’s Company on r/Valueinvesting. In this article, we will summarize the bulls’ thesis on CPB. The Campbell’s Company’s share was trading at $20.91 as of March 24th. CPB’s trailing and forward P/E were 11.46 and 9.01 respectively according to Yahoo Finance.
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The Campbell’s Company, together with its subsidiaries, manufactures and markets food and beverage products in the United States and internationally. CPB is currently trading at roughly 11.5x free cash flow and 11x forward earnings, reflecting a discounted valuation despite offering a 5.8% dividend yield with a payout ratio still below 80%. While leverage remains elevated, it appears manageable, especially in the context of stable cash-generating operations.
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The broader packaged food sector, including peers like Kraft Heinz, Hormel Foods, Conagra Brands, and McCormick & Company, has faced significant pressure amid growing concerns around processed foods, with some names like Kraft Heinz trading at historically depressed levels near 0.7x book value. Campbell’s itself is trading below its 1995 highs and only modestly above its 2009 trough, suggesting a market that is heavily discounting its long-term prospects.
However, the company’s brand portfolio remains a key strength, spanning legacy staples like soups alongside well-recognized names such as Pepperidge Farm, Cape Cod and Kettle Brand chips, Snyder’s, Pretzel Crisps, Goldfish, V8, Prego, and Rao’s. While shifting consumer preferences toward healthier options have weighed on sentiment, demand for convenient meals and snacks continues to persist, supporting the durability of its core categories.
Despite margin pressures in recent periods, Campbell’s has delivered consistent top-line growth, with sales rising approximately 21% cumulatively since 2021. Taken together, the combination of resilient demand, strong brand equity, and compressed valuation suggests that the current pessimism may be overdone, positioning the stock as a potentially attractive, albeit not risk-free, opportunity for investors willing to bet on category stability and normalization.
Previously, we covered a bullish thesis on The Campbell’s Company (CPB) by Scalper’s Lounge in February 2025, which highlighted the company’s strong brand portfolio, leadership overhaul following the Sovos acquisition, and valuation disconnect driven by one-off charges. CPB’s stock price has depreciated by approximately 44.90% since our coverage due to weak snack demand, margin pressure from inflation and tariffs, and elevated leverage following the Sovos Brands acquisition. The author shares a similar view but emphasizes on deep value driven by compressed multiples and sector-wide pessimism.
The Campbell’s Company is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 40 hedge fund portfolios held CPB at the end of the fourth quarter which was 40 in the previous quarter. While we acknowledge the risk and potential of CPB as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CPB and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
