Campbell Soup Slips After Slashing Guidance

"We are committed to accelerating the performance of our existing portfolio, most notably in U.S. soup, and continuing to lay the foundation for superior long-term growth," stated President and CEO Doug Conant. "With the improvements and innovations we've made over the past several years and our plans for next year, we will be able to unleash soup's full competitiveness against the simple meals category."

CPB has sagged in today's trading as investors consider the company's updated sales forecast. The stock is struggling to maintain a foothold atop its 10-week and 20-week moving averages; these formerly supportive trendlines haven't been toppled on a weekly closing basis since mid-December 2009.

If the equity's reaction to today's news seems somewhat muted -- with the shares just fractionally lower at last check -- it's because traders have already priced in plenty of skepticism. Short interest on CPB rose by nearly 33% during the past month, and now accounts for a healthy 4.1% of the stock's float. Analysts are similarly unimpressed, with Zacks reporting 11 holds and just five buy ratings.

With CPB slated to report its fiscal second-quarter earnings next Monday, these low expectations could be a boon for the stock. The food firm has exceeded analysts' profit expectations in each of the previous four reporting periods, and another upside surprise could shake loose some of the weaker bearish hands.

Elizabeth Harrow is a senior equities analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.