A month has gone by since the last earnings report for Pilgrim's Pride (PPC). Shares have lost about 13.8% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Pilgrim's Pride due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent drivers for Pilgrim's Pride Corporation before we dive into how investors and analysts have reacted as of late.
Pilgrim’s Pride Q1 Earnings Miss Estimates, Sales Grow About 1.6% Y/Y
Pilgrim’s Pride Corporation reported fiscal first-quarter 2026 results, wherein the top line increased year over year and came slightly ahead of the Zacks Consensus Estimate, while the bottom line saw a year-over-year decline and fell short of the consensus mark.
Pilgrim’s Pride’s Q1 Metrics in Detail
Pilgrim's Pride posted adjusted earnings of 51 cents per share, missing the Zacks Consensus Estimate of 69 cents. Also, the figure decreased from adjusted earnings of $1.31 per share in the year-ago quarter.
The company generated net sales of $4,532.6 million, which increased 1.6% from $4,463 million in the year-ago quarter. However, the top line came slightly higher than the Zacks Consensus Estimate of $4,500 million.
Pilgrim's Pride’s cost of sales was $4,187.1 million, which increased from $3,908.1 million reported in the year-ago quarter. Gross profit fell year over year to $345.5 million from $554.9 million in the prior year.
Selling, general and administrative expenses were $180.2 million compared with $133.8 million reported in the year-ago period.
The company reported an adjusted EBITDA of $308.1 million, down 42.2% from $533.2 million reported in the year-ago quarter. The adjusted EBITDA margin was 6.8%, a decrease of 520 basis points from 12% reported in the prior-year quarter. The operating income was $162.6 million, a year-over-year decline of 59.8% from $404.5 million.
Decoding PPC’s Segmental Performance
U.S. operations reported net sales of $2,635.4 million, down from $2,743.2 million in the prior year. The adjusted operating income was $110.1 million compared with $326.1 million in the prior year, with an adjusted operating margin of 4.2% compared with 11.9% in the prior-year quarter.
The U.S. Fresh segment advanced initiatives to improve product mix, operational efficiency, and key customer partnerships, strengthening long-term growth and stability. Meanwhile, U.S. Prepared Foods continued strong momentum with record retail volumes. The Just Bare brand delivered nearly 40% year-over-year sales growth, supported by the ongoing construction of a new value-added facility in Walker County, GA.
Europe operations delivered net sales of $1,351.7 million, up from $1,231.5 million in the prior-year period. The adjusted operating income was $67.5 million compared with $65.7 million in the prior year, while the adjusted operating margin declined slightly to 5% from 5.3% in the prior-year quarter.
The steady performance was supported by a balanced portfolio across proteins and meal occasions. Rollover outperformed its category, while Fridge Raiders maintained a stable position in the snacking segment. Ongoing back-office integration and network optimization initiatives continue to enhance productivity and support future growth.
Mexico operations reported net sales of $545.5 million, up from $488.3 million in the prior-year quarter, driven by more than 10% volume growth across its branded Fresh and Prepared Foods portfolio.
Expansion efforts continued through increased production in the South and Peninsula regions, supporting geographic diversification. However, improved growing conditions in live markets and higher imports led to margin compression compared to the first quarter of 2025. The adjusted operating income was $10.9 million, which decreased from $36.6 million in the prior year, with an adjusted operating margin of 2% compared with 7.5% in the prior-year quarter.
Other Financial Aspects of PPC
Pilgrim’s Pride ended the quarter with cash and cash equivalents of $542.4 million, long-term debt (less current maturities) of $3,095.6 million and total shareholders’ equity of $3,736.5 million. The company provided $140.8 million in cash from operating activities for the three months ended March 29, 2026.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted -22.8% due to these changes.
VGM Scores
At this time, Pilgrim's Pride has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock has a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It's no surprise Pilgrim's Pride has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
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Pilgrim's Pride Corporation (PPC): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).