General Mills, Inc.
General Mills, Inc. manufactures and markets branded consumer food in the United States and internationally. The company operates through four segments: North America Retail; International; North America Pet; and North America Foodservice. It offers snacks, including grain, fruit and savory snacks, nutrition bars, and frozen hot snacks; ready-to-eat cereal; convenient meals comprising meal kits, ethnic meals, pizza, soup, side dish mixes, frozen breakfast, and frozen entrees; wholesome natural pet food; refrigerated and frozen dough; baking mixes and ingredients; and ice cream products. The company also offers dog and cat food, such as dry food, wet food, fresh food, and treats. In addition, it operates 232 and franchises 376 ice cream parlors. The company markets its products under the Annie's, Betty Crocker, Bisquick, Blue Buffalo, Bugles, Cascadian Farm, Cheerios, Chex, Cinnamon Toast Crunch, Cocoa Puffs, Cookie Crisp, Dunkaroos, Edgard & Cooper, Fiber One, Fruit by the Foot, Fruit Gushers, Fruit Roll-Ups, Gardetto's, Gold Medal, Golden Grahams, Häagen-Dazs, Kitano, Kix, Lärabar, Latina, Lucky Charms, Nature Valley, Nudges, Oatmeal Crisp, Old El Paso, Pillsbury, Progresso, Tastefuls, Tiki Pets, Total, Totino's, Trix, True Solutions, Wanchai Ferry, Wheaties, Wilderness, and Yoki brands. It sells its products to grocery stores, mass merchandisers, membership stores, natural food chains, drug, dollar and discount chains, e-commerce retailers, commercial and noncommercial foodservice distributors and operators, restaurants, convenience stores, and pet specialty stores. The company was founded in 1866 and is headquartered in Minneapolis, Minnesota.
What does it do?
General Mills is the company behind some of the most recognizable food brands in your kitchen — think Cheerios, Lucky Charms, Häagen-Dazs ice cream, Yoplait yogurt, and Betty Crocker baking mixes. They also own Blue Buffalo, one of America's top pet food brands. Basically, if you walk down the cereal, yogurt, or pet food aisle at a grocery store, you're looking at a General Mills shelf. They sell these products in over 100 countries, though the US is their biggest market by far.
General Mills sits in the 'Consumer Defensive' corner of the market — meaning people keep buying cereal and dog food even when the economy gets rough, which makes the stock a go-to for investors nervous about a recession. But the company is under real pressure right now: shoppers squeezed by years of inflation are trading down to cheaper store-brand products, and General Mills has seen its revenue shrink year-over-year. The question investors are asking is whether iconic brand names are still worth paying a premium for in 2024.
How does it make money?
General Mills pulls in $19.5 billion a year in revenue, mostly by selling packaged food through grocery stores and retailers across four business units. The biggest chunk — North America Retail — covers the cereals, yogurts, and baking products you see on supermarket shelves. North America Pet is their Blue Buffalo dog and cat food business, which they bought for $8 billion in 2018 and is now a major growth engine. North America Foodservice sells to schools, restaurants, and cafeterias, while the International segment handles everything outside the US, including Häagen-Dazs stores in Europe and Asia.
Why do investors care?
The core bull story (the reason to be optimistic) is that General Mills owns brands people have trusted for generations, giving it pricing power that smaller competitors can't match. The Blue Buffalo pet food business is particularly interesting — Americans are spending more on their pets every year, and premium pet food is a fast-growing category. For the thesis to work, General Mills needs to stabilize its shrinking North America Retail sales, keep Blue Buffalo growing, and prove that cost-cutting can protect its profit margins even as revenue dips.
Deep Dive
MemberA full investor briefing on General Mills, Inc. — history, leadership, risks, and outlook.