In a report released yesterday, Akshay Jagdale from Jefferies maintained a Buy rating on Ingredion (NYSE: INGR), with a price target of $125. The company’s shares closed yesterday at $95, close to its 52-week low of $89.48.
Jagdale observed:
“A 2nd significant guide-down in as many qtrs calls into question INGR’s Specialty ingredient strategy. However, we believe the stock reaction has been too extreme & undervalues the Specialty business. Moreover, the issues driving the disappointing 2018 outlook look isolated to INGR’s core business (not Specialty) & largely transitory. Core earnings are not mean reverting due to price competition. In fact, we expect NA sweetener contract prices to be up in 2019.”
According to TipRanks.com, Jagdale is a 4-star analyst with an average return of 3.7% and a 53.3% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and J & J Snack Foods.
Ingredion has an analyst consensus of Hold, with a price target consensus of $107.
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Based on Ingredion’s latest earnings release for the quarter ending June 30, the company reported a quarterly revenue of $1.5 billion and net profit of $114 million. In comparison, last year the company earned revenue of $1.49 billion and had a net profit of $166 million.
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Ingredion, Inc. manufactures and sells sweetener, starches, nutrition ingredients, and biomaterial solutions derived from the wet milling and processing of corn and other starch-based materials. Its activities include turning corn, tapioca, potatoes and other vegetables and fruits into value-added ingredients and biomaterials for the food, beverage, paper and corrugating, brewing, and other industries. It operates through the following geographical segments: North America, South America, Asia Pacific, and Europe, the Middle East, and Africa. The company was founded in 1906 and is headquartered in Westchester, IL.
