General Mills (NYSE:GIS) shares dropped more than 4% yesterday despite the company's reported solid Q2 results, with EPS of $1.10 coming in better than the Street estimate of $1.06. Revenue was $5.2 billion, compared to the Street estimate of $5.18 billion.

Management raised its full-year guidance for organic net sales, adjusted operating profit, and EPS growth. Organic net sales are expected to grow 8-9% in 2023, compared to the prior estimate of 6-7%. Adjusted diluted EPS is now expected to grow 4-6%, compared to the prior estimate of 2-5%.

According to the analyst at Deutsche Bank, unexpected retail inventory destocking in Pet and weaker profitability in International and Pet led to the share underperformance, while NAR momentum remained solid.