General Mills heads into its September 29 earnings release with a pattern that is becoming hard to ignore: shorts are covering ahead of the print, analysts are nudging targets higher, yet the stock keeps falling.
The short-side setup has shifted materially since the last note. Bears have trimmed 6.4% of their position over the week to 8.1% of the free float — continuing the cover-then-rebuild cycle that has played out around each of the last several prints. That said, 8.1% is still an elevated position by historical standards, and the month-over-month decline of just 6.9% shows no wholesale capitulation. Borrow remains cheap at 0.49%, with availability running at 328% — well above the 52-week tightest level of 145% — meaning new shorts face minimal friction if they want back in. The stock itself has dropped 3.4% on the day and 7.4% on the week to $33.64, erasing 15% over the past month. That price action is the sharpest single-month decline in recent history, and it is arriving ahead of, not after, an earnings event.
Options have settled into a neutral posture after the bullish extremes seen before the September 23 print. The put/call ratio is 0.90, barely above its 20-day average of 0.89 and less than a quarter of a standard deviation from that mean. There is no aggressive hedging and no speculative call-buying — the options market is simply waiting. That is a meaningful contrast to the setup a week ago, when the ratio had drifted to its most call-skewed reading in a year. The reset following the September 23 result — which produced only a 1.7% decline — has left positioning balanced rather than charged.
The analyst debate has actually tilted incrementally more constructive in the final days before the print. Barclays raised its target to $37 and RBC reiterated its Outperform with a $45 target, while TD Cowen nudged its Hold target up a dollar to $33. The consensus mean of $37.22 sits 10% above the current price, a gap that has widened sharply as the stock has sold off. Bears, however, have a clear counter: US revenue concentration, a premium valuation that is compressing fast — the forward PE has contracted by 1.6 turns in 30 days to 11.1x — and a consumer still under pressure. The EV/EBITDA of 10.3x has drifted lower by roughly 0.17x on the week alone. BofA raised its Neutral target to $43 on September 1, but that was before the stock lost another 6%.
The September 29 print will test whether the stock's 15% one-month drawdown reflects rational re-rating or overshoots a fundamental picture that — at least by recent analyst moves — appears no worse than it was a month ago.
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