We keep our 12-month target at $60, 13.6x our FY 24 (May) EPS of $4.42 (cut from $4.44; FY 25 up to $4.58 from $4.54) vs. the 17x historical average and the 13x current peer average. FQ1 (Aug-Q) adj-EPS of $1.09 (-1% Y/Y) beat by a penny on sales of $4,905M (+4% Y/Y), in line with consensus. While organic sales grew 4%, organic volumes were down about 2%. The Pet segment (12% of annual sales), which has historically been GIS’s fastest-growing segment, is currently facing softness as pet parents trade down and rationalize, which includes buying less wet pet food and pet snacks. The North America Retail segment (63% of annual sales) is also facing headwinds, including less benefits from inflation-driven pricing and expanding price elasticities. GIS increased media spending by a double-digit percentage, resulting in operating margins falling nearly 40 bps Y/Y to 18.3%. While GIS reiterated its full-year outlook, we see the company tracking toward the lower end of its organic sales and operating profit targets.