In a report released today, Akshay Jagdale from Jefferies maintained a Buy rating on General Mills (GIS), with a price target of $55. The company’s shares closed yesterday at $36.74, close to its 52-week low of $36.42.
Jagdale noted:
“The stock’s underperformance reflects the expectation of a guide-down driven by weak 2Q Pet results. However, we believe FY19 guidance already contemplates weak 2Q Pet results and that the 2H acceleration in Pet earnings is achievable. Base business sales growth trends have improved in 2Q and earnings growth guidance is conservative. We expect 2Q results to be better than feared and believe GIS is the best way to play our BSM thesis. We expect 2Q results and FY19 guidance to be better than feared. We expect GIS to report 2Q EPS of $0.81 (in line with consensus). We have lowered our 2Q estimate slightly, which primarily reflects more 2H-weighted sales growth assumptions in Pet vs. our previous estimates although our FY19 EPS estimate remains unchanged.”
According to TipRanks.com, Jagdale is a 3-star analyst with an average return of 0.7% and a 47.9% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and Conagra Brands Inc.
General Mills has an analyst consensus of Moderate Buy, with a price target consensus of $47.17, a 28.4% upside from current levels. In a report released yesterday, Susquehanna also reiterated a Buy rating on the stock with a $48 price target.
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Based on General Mills’ latest earnings release for the quarter ending August 31, the company reported a quarterly revenue of $4.09 billion and net profit of $392 million. In comparison, last year the company had a net profit of $431 million.
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General Mills, Inc. engages in the manufacture and marketing of branded consumer foods sold through retail stores. It operates through the following segments: North America Retail; Convenience Stores & Foodservice; Europe & Australia; and Asia & Latin America; and Pet.
