In a report released today, Timothy Ramey from Pivotal Research maintained a Buy rating on Post Holdings Inc (POST), with a price target of $125. The company’s shares opened today at $108.30, close to its 52-week high of $113.73.
Ramey noted:
“We assume the business had no EBITDA and POST paid about $100 million with $25 mm of integration costs of TSAs and other, offset to a degree by the NPV of tax savings on the asset step-up. POST said it could generate EBITDA margins similar to its own PL RTE business – we think 15%-18%. Even if we are wrong by a good bit on purchase price, this is a superb value-creation deal if EBITDA could be in the $30-$40 million range – a classic POST deal. $$ in the till. Post Consumer Brands sales fell 0.7%; below our estimate and Street consensus of +2.4%. Volume lagged, down 3.6% driven by declines in branded products and some lift in private label. Adjusted EBITDA was $113 million, down 8.6% from LY and well below our $118 estimate and Street estimates of $122 million. EBITDA margin was 246%, down 220 BP Y/Y.”
According to TipRanks.com, Ramey is a 4-star analyst with an average return of 9.0% and a 57.2% success rate. Ramey covers the Consumer Goods sector, focusing on stocks such as Constellation Brands Inc, Brown-Forman B, and Flowers Foods.
The word on The Street in general, suggests a Moderate Buy analyst consensus rating for Post Holdings Inc with a $125 average price target, implying a 15.4% upside from current levels. In a report issued on April 22, Wells Fargo also maintained a Buy rating on the stock with a $125 price target.
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Post Holdings Inc’s market cap is currently $7.31B and has a P/E ratio of 28.15. The company has a Price to Book ratio of 2.32.
Based on the recent corporate insider activity of 37 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of POST in relation to earlier this year.
TipRanks has tracked 36,000 company insiders and found that a few of them are better than others when it comes to timing their transactions. See which 3 stocks are most likely to make moves following their insider activities.
Post Holdings, Inc. is a consumer packaged goods holding company, which engages in operating of center-of-the-store, refrigerated, foodservice, food ingredient, active nutrition, and private brand food categories. It operates through the following segments: Post Consumer Brands, Weetabix, Refrigerated Food, Active Nutrition, and Private Brands.
