Susquehanna analyst Pablo Zuanic assigned a Buy rating to General Mills (NYSE: GIS) today and set a price target of $50. The company’s shares opened today at $41.93, close to its 52-week low of $41.01.
Zuanic observed:
“We are updating estimates based on the accounting impact of the Blue Buffalo deal (it closed on 4/24, and the company has given color how this will impact the BS starting in 4Q18, including the effect on the share count and net interest expense, and the EBIT line impact starting in FY19), as well as tweaking numbers based on the latest scanner data for the May qtr (we have data through 5/6). GIS will only report 4Q19 (May qtr) results in late June, and hold its annual investor day in July. Clearly a key question mark remains the level of tax reform reinvestment in FY19 and how this will impact profit margins. Based on our latest changes our fiscal 4Q18 EPS of 67c (vs. 77c before the deal impact and scanner data related tweaks) is 9c below consensus (consensus may have not fully reflected the BUFF deal effect, which we estimate is -7c on 4Q18 FY19 our EPS of $3.19 is 1% above consensus.”
According to TipRanks.com, Zuanic is a 3-star analyst with an average return of 3.5% and a 52.5% success rate. Zuanic covers the Consumer Goods sector, focusing on stocks such as Coca-Cola European Partners, Constellation Brands Inc, and Anheuser-Busch Inbev Sa.
General Mills has an analyst consensus of Moderate Buy, with a price target consensus of $50.
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Based on General Mills’ latest earnings release for the quarter ending February 28, the company reported a quarterly net profit of $941 million. In comparison, last year the company had a net profit of $358 million.
Based on the recent corporate insider activity of 73 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 GIS in relation to earlier this year.
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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 and Foodservice, Europe and Australia, and Asia and Latin America.
