General Mills shares tumble of earnings downgradeby Martin Moylan, Minnesota Public Radio
ST. PAUL, Minn. — General Mills' share price is down about 4 percent Friday after the food maker announced that earnings for its current fiscal year won't be as good as the company had hoped.
Weaker sales of products that include Cheerios cereal, Nature Valley granola and Hamburger Helper forced General Mills to cut its previous full-year earnings forecast by about 2 percent.
Bloomberg Research consumer products analyst Ken Shea says General Mills, like other food companies, is having a hard time passing on the rising cost of commodities to consumers.
"Consumers are frugal," he said. "Consumer spending is tight and consumers are looking for bargains. So, it's just a tough environment for food manufacturers in general to generate sales and profitable growth."
The federal government says grocery store prices rose by nearly 5 percent last year, and will likely rise by about 3 percent this year.