Danone: Credit Suisse upgrades sell rating; remains cautious
(CercleFinance.com) - Credit Suisse has upgraded its sell ("underperform") rating on the share of the French agri-food group Danone.
However, analysts remain cautious and have adopted a neutral stance towards the share, while increasing their target price from 61 euros to 67 euros (+9.8%), compared with a current price of about 70 euros.
Credit Suisse now expects organic sales growth of 2.3% in 2017, a figure due out on 16 February. Bought at a high price, WhiteWave is expected to show zero growth, with analysts deeming that the group has paid too much for this acquisition. “In our view, a discount to the staples sector is warranted by greater opacity (10% in terms of 2018 P/E, ed.) and Danone's relatively leveraged balance sheet,” its report says.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.
However, analysts remain cautious and have adopted a neutral stance towards the share, while increasing their target price from 61 euros to 67 euros (+9.8%), compared with a current price of about 70 euros.
Credit Suisse now expects organic sales growth of 2.3% in 2017, a figure due out on 16 February. Bought at a high price, WhiteWave is expected to show zero growth, with analysts deeming that the group has paid too much for this acquisition. “In our view, a discount to the staples sector is warranted by greater opacity (10% in terms of 2018 P/E, ed.) and Danone's relatively leveraged balance sheet,” its report says.
Copyright (c) 2018 CercleFinance.com. All rights reserved.
The information and analyses distributed by Cercle Finance are only intended as decision-making support for investors. Cercle Finance's responsibility may not be entailed, either directly or indirectly following the use of such information and analyses by readers. Any non-professional investor is recommended to consult a professional advisor before making any investment decision. This indicative information in no way constitutes any invitation to sell or buy securities.