ConAgra Foods (CAG 0.86%) gained some momentum in the last month after the company released its third-quarter results. The company beat analysts' estimates that were already quite low. ConAgra already slashed its fiscal 2014 profit forecast twice earlier this year, and investors were happy the company didn't go down that route once again.

ConAgra was finally able to reaffirm its full-year forecast, but the company is in trouble; sales of private-label products and in-house brands are losing steam.Will ConAgra be able to turn its business around? More importantly, is it a good buy when compared to other processed- and packaged-foods players such as General Mills (GIS 1.93%) and TreeHouse Foods (THS 0.30%)? Let's find out.

Trying to get better
ConAgra faces problems in its consumer-foods segment. Volumes were down 3% in the third quarter from last year due to the weak performance of its Orville Redenbacher's, Healthy Choice, and Chef Boyardee brands. However, despite these hardships, ConAgra's effective cost-management strategy enabled it to post some decent numbers in the third quarter.

Going forward, ConAgra will support its brands through aggressive advertising and the four Ps of marketing -- pricing, packaging, placement, and promotion.

Consequently, it is working on the turnaround of Healthy Choice, Chef Boyardee, and Orville Redenbacher's. ConAgra has a specific plan of action to stabilize and improve performance involving product and packaging changes, targeting relevant consumers, and in-store initiatives. In addition ConAgra has lined up some new launches, such as PAM Cooking Spray with coconut oil and Bertolli for the current fiscal year.

ConAgra is also focusing on pot pies, where it has a strong presence and a robust supply chain. This has already helped the company drive growth in the Marie Callender's and Banquet businesses. ConAgra is looking to capitalize on this demand with the help of the Bertolli brand by using its pot pie capabilities to make Italian style tortas. 

In addition, ConAgra's revenue from its milling business also declined due to lower wheat costs that were passed on to customers. However, the bottom line in this segment improved on the basis of a better product mix and production efficiencies.

ConAgra plans to enter into a joint venture for its flour-milling business with Cargill and CHS. Under this agreement, the companies will combine businesses to form a new company called Ardent Mills, which has the potential to control a third of U.S. flour mill capacity. 

More attractive than peers
ConAgra is still working to improve the fundamentals of its business. According to management, the company is receiving positive feedback about the strategies that it is implementing.

Moreover, ConAgra is far cheaper than peers General Mills and TreeHouse Foods. ConAgra trades at a trailing P/E ratio of 16, which comes down to 13 on a forward P/E basis. This indicates that the company's earnings are expected to grow in the future.

On the other hand, General Mills is more expensive at 19 times trailing earnings. On a forward P/E basis as well, General Mills is expensive compared to ConAgra with a P/E ratio of 17. TreeHouse is the most expensive of the lot with a P/E ratio of 30. On a forward P/E basis as well, TreeHouse is expensive with a multiple of 18.

Moreover, of all three companies, ConAgra is the highest dividend payer with a yield of 3.3%. General Mills is next with a yield of 3.2%, while TreeHouse doesn't pay a dividend.

Bottom line
ConAgra is undervalued when compared to peers, and the company is taking a number of steps to improve its business. The introduction of new products and aggressive marketing should help it to get back on track, making ConAgra a good buy at current levels.