General Mills (GIS) delivered stronger-than-expected fiscal Q4 results and issued a "better-than-feared" financial outlook for the coming year, UBS Securities said in a report emailed Thursday.

Solid organic sales growth, gross margin expansion and operating profit helped drive the earnings beat, UBS said, with fiscal Q4 adjusted earnings per share of $0.95 topping both its own and Wall Street estimates. Organic sales were roughly flat, exceeding analyst and consensus forecasts, according to the report.

General Mills' fiscal 2027 guidance "largely bracketed" analyst and Wall Street expectations, calling for adjusted EPS of $3 to $3.20 while forecasting organic sales from a 1.5% decline to 0.5% growth. The company also expects lower operating profit, although planned cost savings are expected to help offset some of the pressure, the report said.

While UBS said investors may question the company's ability to achieve its sales outlook following a difficult fiscal 2026, it expects the stronger-than-anticipated quarterly results and better guidance to support the shares, according to the report.

UBS has a sell rating on General Mills with a price target of $30.

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