After all these years, the soup is no longer available.
Campbell's Soup (CPB) has had that moniker since 1869, but in November a major part of that iconic name will disappear as the first company to sell canned soup will be known as Campbell's Co.
Related: Campbell Soup seeks a modern Andy Warhol moment
“This subtle but important change preserves the company’s iconic name recognition, reputation and value built over 155 years, while better reflecting the breadth of the company’s portfolio,” CEO Mark Clouse said in a statement.
Clouse said Campbell, which held an Investor Day at the Nasdaq MarketSite in New York on Sept. 10, has been on “a transformative journey” over the past five years.
“We are ready to turn the page and enter a new chapter building on Campbell's transformed portfolio, strong team and aligned, committed culture to set the standard for performance in the food industry,” Clouse said.
The company outlined plans for “the next era of accelerated growth,” which included achieving adjusted earnings per share growth of approximately 7% to 9% through fiscal 2027.
This company offers much more than soup.
In March, Clouse told analysts that Goldfish crackers officially surpassed $1 billion in net sales, making it the second billion-dollar brand in the portfolio, on par with Andy Warhol's beloved soup cans.
That same month, Campbell's completed its $2.7 billion acquisition of Sovos Brands, owner of Rao's Homemade.
Campbell creates new business unit
The company has formed a new business unit within the Food and Beverage division called Distinctive Brands, which will include Sovos Brands, which consists of pasta sauces, dry pastas, soups, frozen pizza and yogurts.
It's important to note that Campbell is not the first company to play the name game.
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Most people know that Google changed its username to Alphabet. (GOOGL) in 2015, but back in 1996, the search engine giant was supposedly known like BackRub — yes, really, Back massage — for his analysis of the website’s “back links”.
However, that name disappeared when the word “googolplex” was shortened to “googol” and then a misspelling gave rise to the world “Google.”
Online retail and entertainment giant amazon (amazon.com) It was originally known as Cadabra, a pun on the magic word “abracadabra,” but founder Jeff Bezos made that name disappear when a lawyer misheard the original name as “cadaver.”
Remember when facebook became Meta Platforms in 2021? (GOAL) ?
CEO Mark Zuckerberg argued that the company had much more to offer than social apps, explaining that “the metaverse is the next frontier for connecting people, just like social media was when we started.”
Yum Brands (Mmmmm) Kentucky Fried Chicken invented the name KFC and WW International (World) It used to be called Weight Watchers.
Heck, even Apple! (APL-American Lead Association) It was once Apple Computer, but in 2007 co-founder Steve Jobs said the company would change its name to Apple to focus more on consumer electronics.
Company name changes: “varying degrees of success”
“The decision to change a company's name is a complicated proposition, but companies continue to do so with varying degrees of success,” the Wharton School of Business at the University of Pennsylvania noted in an article published in the Journal. podcast 2018.
“I think the perspective of trying to reinvent yourself, trying to refresh what you do, is an important aspect,” said marketing professor Americus Reed. “It’s also kind of a double-edged sword because a lot of times we have nostalgia wrapped up in these brands.”
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Some name changes come in the wake of scandals or disasters. Reed said that “sometimes you have to take certain things into account when you're trying to create psychological distance between something that's happened.”
“There has been a brand crisis,” Reed said. “Maybe it makes sense to do it a little bit faster and jump right in.”
There was a strong reaction to Campbell's rebranding of the microblogging site x, which was twitter until the owner and Tesla (TSLA) CEO Elon Musk made that name go away.
Analyst: Risk/reward ratio 'relatively attractive'
“Because changing brands is always a brilliant decision” x.com/NickMartin14/status/1833596538570031520″>Nick Martin said.
“We love less choice and big corporations! My favorite,” poster x.com/davethedoorman3″>daveelportero3 wrote.
“Wait, they were called Campbell's soup?” she asked. x.com/PrideOfHumility”>Eric Cromwell“I always thought it was just Campbell's and that soup was only in soup cans. That shows how much I pay attention to it.”
Campbell Soup beat Wall Street's fourth-quarter earnings expectations last month, with total sales of $2.3 billion, up 11% from a year earlier. The sales increase was largely attributed to its acquisition of Sovos Brands.
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“We continue to see momentum in the Sovos Brands business and are making progress in integrating the best-in-class growth story in food into our food and beverage business,” Clouse said during the company's press conference. earnings call.
Clouse said the only negative indicator was a modest reversal in consumer confidence in the fourth quarter, “indicating the somewhat fragile state of the consumer and why being cautious with expectations still makes sense.”
“Overall, however, as we've said before, we continue to see the recovery of the consumer environment not as a question of if, but rather when,” he said.
Analysts reacted to Campbell's Investor Day announcements.
Barclays raised the investment firm's price target for Campbell Soup to $49 from $45, while affirming an underweight rating on the stock, according to The Fly.
The firm said it understood “investor reservations” around Campbell’s decision to increase its long-term growth algorithm. This, according to Barclays, is because the track record of success of packaged food companies that have done so “is patchy, to say the least”.
Barclays said Campbell's management had “thought long and hard” about whether to increase its organic sales growth algorithm.
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Given the addition of Sovos Brands, planned incremental capex, increased contribution from innovation and an advantageous supply chain, the investment firm said the company “was hard-pressed not to express some level of increased optimism for the potential of its top line, even in a broader context.”
JP Morgan raised its price target on Campbell to $57 from $55, implying a total shareholder return of 15%, and maintained an overweight rating on the stock.
The investment firm still sees the stock's risk/reward balance as “relatively attractive” after Investor Day. JP Morgan said it was “encouraged” to learn that Campbell's food and beverage unit is expected to reach a 19% margin in fiscal 2027, thanks in part to efficiency gains.
The firm noted that the company's guidance already incorporates more spending.
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