FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Jul. 28, 2024

Schedule of financial assets and liabilities carried at fair value on a recurring basis

The Company’s financial assets and liabilities carried at fair value on a recurring basis and their level within the fair value hierarchy are presented in the tables below.


	Fair Value Measurements at July 28, 2024
In thousands	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets at Fair Value
Cash and Cash Equivalents(1)	$	537,476	$	537,008	$	468	$	—
Short-term Marketable Securities(2)	24,454		4,970		19,484		—
Other Trading Securities(3)	206,980		—		206,980		—
Commodity Derivatives(4)	7,067		9,298		(2,231)		—
Total Assets at Fair Value	$	775,976	$	551,276	$	224,700	$	—
Liabilities at Fair Value
Deferred Compensation(3)	$	61,425	$	—	$	61,425	$	—
Total Liabilities at Fair Value	$	61,425	$	—	$	61,425	$	—


	Fair Value Measurements at October 29, 2023
In thousands	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets at Fair Value
Cash and Cash Equivalents(1)	$	736,532	$	735,387	$	1,145	$	—
Short-term Marketable Securities(2)	16,664		2,499		14,164		—
Other Trading Securities(3)	188,162		—		188,162		—
Commodity Derivatives(4)	9,330		9,603		(273)		—
Total Assets at Fair Value	$	950,688	$	747,489	$	203,199	$	—
Liabilities at Fair Value
Deferred Compensation(3)	$	55,222	$	—	$	55,222	$	—
Total Liabilities at Fair Value	$	55,222	$	—	$	55,222	$	—

The following methods and assumptions were used to estimate the fair value of the financial assets and liabilities above:

(1) The Company’s cash equivalents considered Level 1 consist primarily of bank deposits, money market funds rated AAA, or other highly liquid investment accounts, and have a maturity date of three months or less. Cash equivalents considered Level 2 are funds holding agency bonds or securities recognized at amortized cost.

(2) The Company holds securities as part of a portfolio maintained to generate investment income and to provide cash for operations of the Company, if necessary. The portfolio is managed by a third party who is responsible for daily trading activities, and all assets within the portfolio are highly liquid. The cash, U.S. government securities, and money market funds rated AAA held by the portfolio are classified as Level 1. The current investment portfolio also includes corporate bonds and other asset backed securities for which there is an active, quoted market. Market prices are obtained from a variety of industry providers, large financial institutions, and other third-party sources to calculate a representative daily market value, and therefore, these securities are classified as Level 2.

(3) The Company maintains a rabbi trust to fund certain supplemental executive retirement plans and deferred compensation plans. The majority of the funds held in the rabbi trust relate to supplemental executive retirement plans and have been invested primarily in fixed income funds managed by a third party. The declared rate on these funds is set based on a formula using the yield of the general account investment portfolio supporting the fund, as adjusted for expenses and other charges. The rate is guaranteed for one year at issue and may

be reset annually on the policy anniversary, subject to a guaranteed minimum rate. As the value is based on adjusted market rates and the fixed rate is only reset on an annual basis, these funds are classified as Level 2.

Under the Company’s deferred compensation plans, participants can defer certain types of compensation and elect to receive a return based on the changes in fair value of various investment options, which include equity securities, money market accounts, bond funds, or other portfolios for which there is an active quoted market. The Company also offers a fixed rate investment option to participants. The rate earned on these investments is adjusted annually based on a specified percent of the U.S. Internal Revenue Service (IRS) applicable federal rates. These liabilities are classified as Level 2. The Company maintains funding in the rabbi trust generally mirroring the selections within the deferred compensation plans. These funds are managed by a third-party insurance policy, the values of which represent their cash surrender value based on the fair value of the underlying investments in the account. These policies are classified as Level 2.

The rabbi trust is included in Other Assets and deferred compensation liabilities in Other Long-term Liabilities on the Consolidated Statements of Financial Position. Securities held by the rabbi trust are classified as trading securities. Unrealized gains and losses associated with these investments are included in the Company’s earnings. During the quarter and nine months ended July 28, 2024, securities held by the rabbi trust generated gains of $4.9 million, and $18.8 million, respectively, compared to gains of $5.1 million and $12.1 million for the quarter and nine months ended July 30, 2023, respectively.

(4) The Company’s commodity derivatives represent futures, swaps, and options contracts used in its hedging or other programs to offset price fluctuations associated with purchases of corn, natural gas, diesel fuel, hogs, and pork, and to minimize the price risk assumed when forward priced contracts are offered to the Company’s commodity suppliers. The Company’s futures and options contracts for corn are traded on the Chicago Board of Trade, while futures contracts for lean hogs are traded on the Chicago Mercantile Exchange. These are active markets with quoted prices available, and these contracts are classified as Level 1. The Company holds natural gas, diesel fuel, and pork swap contracts that are over-the-counter instruments classified as Level 2. The value of the natural gas and diesel fuel swap contracts is calculated using quoted prices from the New York Mercantile Exchange, and the value of the pork swap contracts are calculated using a futures implied USDA estimated pork cut-out value. All derivatives are reviewed for potential credit risk and risk of nonperformance. The net balance for commodity derivatives is included in Other Current Assets or Accounts Payable, as appropriate, on the Consolidated Statements of Financial Position. As of July 28, 2024, the Company had recognized the right to reclaim net cash collateral of $29.3 million from various counterparties (including cash of $37.7 million less $8.4 million of realized loss). As of October 29, 2023, the Company had recognized the right to reclaim net cash collateral of $32.2 million from various counterparties (including cash of $42.6 million less $10.4 million of realized loss).