We publish no single base value for Hormel Foods. Our valuation methods put it between $19.58 and $23.36 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
| Method | Value | vs price | Basis |
|---|---|---|---|
| Discounted cash flow | $23.36 | +7.0% | free cash flow $780.87m, growth -2.4% for 5 years, then fading to 3% over 5 more, discounted at 7.42%; stress floor $17.66 |
| Exit multiple (P/E) | $19.58 | -10.3% | earnings per share $1.48 valued at 18.9× (the stock's own median P/E) in 5 years, discounted back |
| Sum of the parts | — | — | no sum of the parts: this run holds no segment disclosure for the name |
| Price to sales | — | — | not reached: the cash-flow or earnings methods produced an anchor, so this fallback was not run |
| Tangible book | — | — | used only for lenders, where book value is the business |
| Price to FFO (REITs) | — | — | used only for REITs |
Each working is rebuilt by code from the valuation's own figures and checked against the published value.
The discount rate:
| Risk-free rate | 5.13% (10-year US Treasury yield) |
| Company's own beta | 0.27 (5 years of monthly returns against the S&P 500; standard error 0.19) |
| Peer beta | 0.26 (median of 7 S&P 500 Packaged Foods & Meats companies) |
| Blend of own and peers | 0.27 (57% own, 43% peers, weighted by how precisely the company's own beta is measured) |
| Adjusted beta | 0.51 (0.67 × 0.27 + 0.33, pulled toward the market's 1.0) |
| Equity risk premium | 4.5% |
| Discount rate = risk-free + adjusted beta × premium | 7.42% |
Free cash flow grows -2.40% a year for 5 years, then fades in equal steps toward 3% over 5 more; each year is discounted by 1 ÷ (1 + rate)^year:
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Now | — | $780.87m | — | — |
| Year 1 | -2.40% | $762.13m | 0.9309 | $709.45m |
| Year 2 | -2.40% | $743.84m | 0.8665 | $644.57m |
| Year 3 | -2.40% | $725.98m | 0.8066 | $585.61m |
| Year 4 | -2.40% | $708.56m | 0.7509 | $532.05m |
| Year 5 | -2.40% | $691.56m | 0.6990 | $483.39m |
| Year 6 | -1.50% | $681.18m | 0.6507 | $443.23m |
| Year 7 | -0.60% | $677.10m | 0.6057 | $410.12m |
| Year 8 | 0.30% | $679.13m | 0.5638 | $382.92m |
| Year 9 | 1.20% | $687.28m | 0.5249 | $360.73m |
| Year 10 | 2.10% | $701.71m | 0.4886 | $342.85m |
| Terminal value = year-10 cash flow × (1 + 3%) ÷ (7.42% − 3%) | $16.33bn |
| Terminal value in today's money | $7.98bn |
| Present value of years 1–10 | $4.89bn |
| Total present value | $12.88bn |
| Shares outstanding | 551.07m |
| Value per share = total ÷ shares | $23.36 |
How the DCF value moves with the discount rate and the starting growth (the middle cell is the published value):
| Discount rate | Growth -7.4% | Growth -2.4% | Growth 2.6% |
|---|---|---|---|
| 6.42% | $21.32 | $29.84 | $41.51 |
| 7.42% | $16.91 | $23.36 | $32.16 |
| 8.43% | $14.11 | $19.26 | $26.25 |
The same DCF at each beta, starting growth unchanged:
| Beta | Value | Discount rate | DCF value |
|---|---|---|---|
| Company's own beta | 0.27 | 6.34% | $30.52 |
| Peer beta | 0.26 | 6.30% | $30.92 |
| Adjusted beta (used) | 0.51 | 7.42% | $23.36 |
Earnings per share grow on the same fading path as the DCF:
| Year | Growth | Earnings per share |
|---|---|---|
| Now | — | $1.48 |
| Year 1 | -2.40% | $1.45 |
| Year 2 | -0.78% | $1.44 |
| Year 3 | 0.35% | $1.44 |
| Year 4 | 1.15% | $1.46 |
| Year 5 | 1.70% | $1.48 |
| Earnings per share in year 5 | $1.48 |
| Exit P/E (the stock's own median P/E) | 18.9× |
| Value in 5 years = earnings × P/E | $28.01 |
| Discounted at 7.42% over 5 years: ÷ 1.4306 | $19.58 |
We publish no single base value for Hormel Foods. Our valuation methods put it between $19.58 and $23.36 a share. The valuation code's reason: no point fair value: the two anchors behind it compound the same growth rate and differ only in how they end — a perpetuity at the terminal rate against a multiple on the final year — so the midpoint between them measures terminal treatment rather than what the business is worth. The published range is the same reading with the false precision removed: read it as the span the method supports, and treat neither edge as a point estimate.
One-year price simulation: a 10% chance the price is below $14.56 and a 10% chance it is above $33.91 in a year; a 52% chance it is higher than today's $21.83, from 32.81% volatility. The simulation assumes the price drifts up at our discount rate of 7.42% a year.
At $21.83 the price implies free cash flow growing -3.5% a year for five years and then fading toward 3% over five more; its revenue has grown -2.4%.
| Week | Price | Base value |
|---|---|---|
| 2 Oct 2026 | $20.25 | — |
| 9 Oct 2026 | $19.19 | — |
| 16 Oct 2026 | $20.40 | — |
| 23 Oct 2026 | $21.06 | — |
| 30 Oct 2026 | $21.28 | — |
| 6 Nov 2026 | $21.95 | — |
| 12 Nov 2026 | $21.83 | — |
Data as of 12 Nov 2026; financials to 31 Jul 2026. Sources: company filings via EODHD, SEC EDGAR, US Treasury. How these values are computed. Not investment advice.
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