Jefferies analyst Akshay Jagdale downgraded Hormel Foods (HRL) to Hold today and set a price target of $44. The company’s shares closed yesterday at $45.71, close to its 52-week high of $46.26.
Jagdale noted:
“Sector rotation into high-quality staples like HRL combined with significantly better pork margins have more than offset bottoming turkey margins, resulting in the stock significantly outperforming (up 34% vs -1% for S&P over last 9 months) & its valuation premium setting new peaks. We believe HRL deserves a DD valuation premium to peers but current 34% premium prices in all the good news. As such, we downgrade the stock to Hold & wait for a better entry point. Sector rotation into staples combined with significantly better pork processing margins have driven HRL’s outperformance. Recall, we upgraded HRL (2/14) driven by BSM report findings & a more optimistic outlook on pork processing margins.”
According to TipRanks.com, Jagdale is a 4-star analyst with an average return of 2.5% and a 49.6% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and Conagra Brands Inc.
Hormel Foods has an analyst consensus of Hold, with a price target consensus of $43, implying a -5.9% downside from current levels. In a report issued on November 20, Oppenheimer also maintained a Hold rating on the stock.
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The company has a one-year high of $46.26 and a one-year low of $31.71. Currently, Hormel Foods has an average volume of 2.83M.
Based on the recent corporate insider activity of 65 insiders, corporate insider sentiment is negative on the stock. Most recently, in September 2018, Deanna Brady, the Group VP of HRL sold 48,000 shares for a total of $1,969,920.
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Hormel Foods Corp. engages in the production of meat and food products. It operates business through the following segments: Grocery Products, Refrigerated Foods, Jennie-O Turkey Store, Specialty Foods, and International & Other.
