Beef and nut prices have surged — and that’s driving Hormel’s stock to its biggest drop ever

Hormel Foods Corp.’s stock could see the steepest one-day loss in its trading history on Thursday after the maker of Spam, Planters nuts and Jennie-O turkey slashed its profit outlook due to higher-than-expected costs for meat and nuts.

Hormel’s stock

HRL

-13.09%

was down 13.5% to $25.11 a share, which will mark its lowest finish in about 10 years if the losses hold through the close, according to Dow Jones Market Data.

Hormel said it’s taking “targeted pricing actions” in the face of beef, pork and nut markets that have “worsened significantly beyond our projection.”

For example, the price of pork bellies — the underside of the animal used to make bacon — rose 30%, the company said.

Beef prices, which have posed a challenge due to lower supply, are “a persistent inflationary headwind industry-wide and near [an] all-time high,” Chief Financial Officer Jacinth Smiley said on a conference call Thursday following the company’s quarterly earnings report, according to a transcript.

Hormel warned it now expects fiscal fourth-quarter earnings of 38 cents to 40 cents a share, which is below the FactSet consensus estimate of 47 cents a share.

Hormel’s third-quarter profit rose to $183.74 million, or 33 cents a share, from $176.7 million, or 32 cents a share, in the year-ago quarter.