General Mills (GIS) investors will likely seek evidence that the implied top-line acceleration embedded in fiscal 2027 outlook is feasible, with the company lapping last year's pricing investments and shifting its focus toward innovation, UBS said in a research note.

The company's fiscal 2027 guidance of $3.00 to $3.20 in earnings per share includes expected organic sales declines of 1.5% to a growth of 0.5%, the firm noted. Additionally, net sales are expected to reduce by 2% on account of divestitures, acquisitions, forex, and the 53rd week, UBS said in a Thursday report.

Management commentary from General Mills further indicates that Q1 organic sales growth is likely to come in below the full-year guidance range, owing to shipment-related headwinds in both North America Retail and North America Pet segments, UBS added

Furthermore, the company's Q3 represents the "easiest" year-over-year comparison of the year before organic sales growth faces a more challenging setup in Q4, according to the note.

UBS raised its price target to $33 from $30 and maintained its Sell rating.

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