Smithfield Near Breakout As Iran War Drives Food, Plastics Prices

Packaged food company Smithfield Foods (SFD), which specializes in pork products, broke out Wednesday after an earnings report that trounced expectations.

On Thursday, shares rose 1.3% when the market opened, peaking narrowly above a buy point of 25.50 in a cup-with-handle base, according to MarketSurge.

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Smithfield Foods makes a slew of processed meat products such as lunch meats, bacon, sausages and precooked barbecue. It relisted on the Nasdaq in January 2025 after the Hong Kong-based conglomerate WH Group took the company private in 2013.

Smithfield Food Earnings

The stock jumped more than 4% on Tuesday after it reported fourth-quarter results before the opening bell. Smithfield Foods topped analyst expectations across the board. Quarterly revenue came in at $4.227 billion, with earnings per share of 83 cents apiece. Wall Street had expected revenue of $4.138 billion and EPS of 69 cents, according to FactSet.

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In January, Smithfield announced it would acquire the hot dog brand Nathan’s Famous for $102 a share. CEO Shane Smith said Nathan’s Famous would be “immediately accretive” to Smithfield’s business. The company also announced plans to invest $1.3 billion over the next three years into a new pork processing plant in Sioux Falls, South Dakota.

2026 Outlook

Smithfield Foods offered strong guidance for 2026. Adjusted operating profit is forecast to be between $1.325 billion and $1.475 billion, which would imply growth of between 2.6% and 14.2%. (The adjusted operating income does not include the impact of the Nathan’s Famous deal or the investments in the Sioux Falls facility, according to CFO Mark Hall).

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The 2026 outlook comes despite the fact Smithfield Foods faces several headwinds, such as the possibility of weakening consumer demand, rising fuel prices and potential food and plastics shortages. Both fertilizer and some plastics feedstock supplies are restricted because of the ongoing war in Iran. Significant portions of the world’s supply of the commodities travel through the Strait of Hormuz, which is currently blockaded.

For Smithfield Foods, higher natural gas prices can drive up the cost of the plastic packaging used in many of Smithfield’s Foods products. Meanwhile, higher fertilizer costs mean feed for pigs becomes more expensive, which subsequently affects pork prices.

“Potential headwinds that we’re monitoring include a continued cautious consumer spending environment and a dynamic geopolitical environment,” Hall said during an investor call on Tuesday.

Hall added it was “still too early to predict the full impact” of the Iran war but that he expected it would affect fuel costs, corn prices, and packaging.

In 2026, Smithfield Foods plans to pay an annual dividend of about $1.25. Based on Thursday’s opening price of 25.25, that would amount to a 4.95% dividend yield.

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