J.M. Smucker Co. (SJM) Rose on Continued Challenges at Hostess

Ariel Investments, an investment management company, released its “Ariel Fund” second-quarter 2025 investor letter. A copy of the letter can be downloaded here. The second quarter was a volatile period. Stocks fell sharply in early April following the “Liberation Day” tariff announcement, pushing the market close to bear market territory. Later, the pause in plans led to a strong recovery. Excitement for artificial intelligence (AI) stocks reignited, with positive economic data and strong corporate earnings driving U.S. indices to new all-time highs. Growth stocks outperformed value stocks, and large caps continued to outperform their small-cap counterparts. Against this backdrop, Ariel Fund returned 6.96% in the quarter, lagging behind both the Russell 2500 Value Index’s +7.29% return and exceeding the Russell 2000 Value Index’s +4.97% gain. For more information on the fund’s top picks in 2025, please check its top five holdings.

In its second quarter 2025 investor letter, Ariel Fund highlighted stocks such as The J. M. Smucker Company (NYSE:SJM). The J. M. Smucker Company (NYSE:SJM) manufactures and markets branded food and beverage products. The one-month return of The J. M. Smucker Company (NYSE:SJM) was 9.07%, and its shares lost 8.66% of their value over the last 52 weeks. On July 18, 2025, The J. M. Smucker Company (NYSE:SJM) stock closed at $106.16 per share, with a market capitalization of $11.326 billion.

Ariel Fund stated the following regarding The J. M. Smucker Company (NYSE:SJM) in its second quarter 2025 investor letter:

“Leading manufacturer of consumer food products, The J. M. Smucker Company (NYSE:SJM) also declined during the period. Quarterly earnings benefitted from the company’s legacy businesses anchored by the Uncrustables brand and coffee portfolio, however continued challenges at Hostess weighed on results. Meanwhile, management delivered disappointing fiscal year 2026 guidance due to expected profit declines driven by inflation related to higher expected coffee costs, tariffs and continued weakness at Hostess. SJM remains focused on stabilizing revenue and management believes SKU and display rationalization alongside marketing investments will help. Longer-term, we continue to believe SJM’s portfolio of iconic and emerging foods brands, coupled with its broad based innovation and productivity agenda, supports an attractive total shareholder return opportunity.”

The J. M. Smucker Company (SJM) I Told Them Not To Buy Twinkies!, Says Jim Cramer

A wholesaler distributing peanut butter, fruit spreads and specialty spreads to a retailer.

The J. M. Smucker Company (NYSE:SJM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 37 hedge fund portfolios held The J. M. Smucker Company (NYSE:SJM) at the end of the first quarter, compared to 37 in the previous quarter. While we acknowledge the risk and potential of The J. M. Smucker Company (NYSE:SJM) 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 The J. M. Smucker Company (NYSE:SJM) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered The J. M. Smucker Company (NYSE:SJM) and shared the list of consumer defensive stocks to buy. Ariel Fund highlighted The J. M. Smucker Company (NYSE:SJM) last quarter, citing strong earnings beat and a raised FY25 EPS outlook as key drivers of its performance. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.