DA Davidson Cuts Hormel (HRL) to Underperform, Cites Valuation

Hormel Foods (NYSE: HRL) shares tumbled sharply this morning following an intraday downgrade from an analyst at DA Davidson.

The firm calls Hormel shares overvalued: "the protein sector trades at a discount to the rest of the packaged foods industry, yet HRL has been able to maintain a lofty 17.8x FY12 EPS valuation." While DA Davidson doesn't see this as an appropriate valuation, the firm still feels Hormel is "one of the best of breed in the protein space."

After opening in positive territory, shares of Hormel are now down about 1 percent to $29.98.

For more ratings news on Hormel Foods click here and for the rating history of Hormel Foods click here.

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