 Jenny Horne, thanks so much for that report. We are watching General Mills. General Mills is trading higher after its results this morning. Let's take a closer look into what's going on here. Our panel is ready. Arun Sunderam, Equity Research Analyst at CFRA and Melissa Armo, founder, owner of the stocks. Thank you both for being with us. So Arun, I'll start with you. We saw a beat. We know the prices have been on the rise 20, 30, depending on what you're buying at the supermarket. What did you think of the quarterly report and more importantly, the outlook? Arun? Yeah, great question, Nicole. The quarter was good. All things considered, they beat EPS by six cents. Organic sales were up 4%. And more importantly, I think price mix was up 7% this quarter. This is actually the third consecutive quarter where you saw price mix sequentially accelerate. And it sounds like from their earnings call today, it sounds like price mix will even further accelerate their upcoming quarter fiscal Q4. It's a really strong price mix. And it's obviously being driven by cost push inflation, costs are on the rise. Everyone knows that. And one thing you gotta remember is these price increases that we're seeing, these are price increases or price hikes that was announced last year. So it's finally making its way into the income statement for General Mills and other packaged food companies. So there's a hope that maybe gross margins have bottomed here. But there obviously are lots of risks right now given what's going on with commodity prices, especially after Russia's invasion of Ukraine. But for a lot of packaged food companies, including General Mills, they are largely hedged in a lot of their raw materials and packaging stuff like that. So what's happening right now in the commodity markets isn't really leaving a significant impact on them right now. But that remains to be seen if that's going to happen down the road. Yeah. And I'm curious to hear more about some of the other names in the group and whether or not you think they're passing prices on to the consumer. Melissa, I'd like to bring you into the conversation here with a name like General Mills, which is seeing this up arrow today. Tell me your thoughts. Well, it's falling today, even though it gapped up in the morning, and this stock is strong, but it's nowhere near the previous highs, which was a long time ago, back up at 72. The problem that they announced today in the earnings report was that they're having a problem meeting demands in the stores. Pills, buried products is one of the things that they sell. They can't meet the demands. You go into stores now and this is all across the board. Other companies are having this issue too. Why aren't the products there? Typically, they said they'd like to meet 97, 98, 99% of the demand for their products. In other words, you go in, you can always get a Pills, buried product, but that's not the case right now. And the reason is, again, the same thing we've been talking about for two solid years, supply chain shortages. They're having problems getting the products to make the things that they need to make to sell. They're having problems getting the products out to people and they're already talking about inflation being a problem, even going into the rest of 2022 and even beyond. Right now, I just don't understand why they're saying the inflation rates overall 4.7%. I don't believe that. As a consumer, I go in and everything is increased in prices. Some things have increased 30, 40, 50%. I've seen some food things that have doubled. So this is going to hit the fan when it comes to our next journey report. So again, if they can't get the grains and the oils and the fats and the things they need to make all of their products, how are they going to get them out to the consumer to buy them? That affects their bottom line if they can't sell the products in order to make the money. Right. Up 2.5% right now for general mills at 64.21%. It's been a, for the year, you're to date down about 4%. Is general mills are doing something better or worse than some of the other names in the group? Do you like general mills? You're rating on that one versus some of the others? Yeah, we have a buy rating. We have a buy rating and a $72 target price on general mills right now. They're one of their few buys in the package food space. Obviously, we've been seeing investors recently gravitate more towards value stocks as opposed to growth. And I think there's a lot of value in the package food space. General mills is a little bit more expensive compared to peers, but relative to other industries within the consumer staple sector, I think package food is a good place to put your money. A lot of the companies in the package foods are trading around 14, 15 times forward earnings. That's much lower than some of the household product companies we cover around 20, 25 times earnings, forward earnings, and even beverages companies that we cover typically trade around north of 20 times earnings. So there is a lot of value, I think, in package foods here, and that's one of the reasons we have a buy in general mills. Yeah, that's interesting. You brought up beverage because I was actually thinking about that and how that fits into the picture if it's similar or different from some of the package foods. So as we expand this out, Melissa, are there names or groups within what the consumer is buying or doing, the habits that we're seeing that could be winners? Well, I think general mills is still good buy even though, again, it fell today on the earnings. I still think this is the best in the sector. When I look at other things like craft or even Campbell's soup, those charts do not look as good as general mills. So again, I look at the technicals. I'm looking at the strength in something compared to the weakness in it. While they've all had rallies since the lows two years ago when COVID first hit, general mills has had the biggest move up. So again, across the board, as far as the overall sector concerns, I do like this pick as the best pick even though the stock is down today. Yeah. I run most of the analysts, I see a lot of holds on general mills. What do you think is holding them back from saying buy? Well, I think it's really related to all the broader things that we're seeing, especially right now, I think a lot of investors on their toes trying to figure out if inflationary pressure is going to get worse throughout the year, we've seen prices of a lot of key commodities rise 20, 30% over the past few months, given what's going on in Russia and Ukraine, wheat prices, soybean prices, things like that. And right now, everyone's like, is that going to impact the bottom line going forward? But I think the positive that we heard today from general mills is that they are almost fully hedged on the commodity needs for the remainder of this fiscal year, and they are about 50% hedged for the rest of calendar 2022. So they shouldn't, at least for the next few quarters, I don't think they'll still see significant cost inflation. But if commodity prices remain elevated throughout the rest of this year, then there's no doubt that general mills, as well as other packaging companies, are going to experience higher costs next year. And who knows if they can increase prices even more next year, they've already increased prices a bunch over the past year. So we already know consumer budgets are going to be tight right now. So I don't think that the package food companies will have that much leeway to implement further price increases going forward. Yeah, from cereals to snacks to ice cream, prepared foods that are ready to go, convenient meals, that's what we think of when we think of general mills. Final quick thought, Melissa Armo. Well, I definitely think costs are going to go up. I definitely think inflation is going to go up and interest rates are going up too. And I just want to say that I think that that pal said that he did thought inflation last year was transitory. He's saying the same exact thing this year. And he they think that rising interest rates or raising interest rates is going to stop the problem. I don't think so because it's not going to help the problem with getting the supplies and the shortages we're having to put more pressure on the consumer, because they're going to pay extra things and higher costs and interest rates, and then they can't get the stuff they need as a result of that too. So I think overall, we're not I'm sort of bearish in the market to be honest. We've rallied in the last week. So that's what I said. Understood. Nice to see you both very, very much. Thank you. I enjoy our conversations. Thank you for coming on with us each time. Melissa Armo of the Stock Swoosh, Arun Sundaram of CFRA. Thank you. Thank you friends for being with us here on the watch list every single weekday at 2 p.m. Eastern time. I'm Nicole Petalides. Keep it right here. Market Unclosed is next.