Nomura analysts are weighing in with positive views on oft drinks giant The Coca-Cola Co (NYSE:KO) and cosmetics maker Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA). Let’s take a closer look.
The Coca-Cola Co
Analyst Ian Shackleton was out pounding the table on Coca-Cola Friday, reiterating a Buy rating and price target of $54, which represents a potential upside of 19% from where the stock is currently trading.
Shackleton wrote, “Although valuation has moved up in the past few months towards the top of the large-cap consumer range, we think the asset-light model argues for a premium to other consumer companies. Our analysis of EV/IC vs company ROIC indicates that, even with the existing refranchising programme, KO looks some 15%+ undervalued against peers; including further asset disposals of equity stakes could increase this undervaluation to over 30%.”
“We see a strong probability that ABI will become a major Coke bottler once the purchase of SABMiller is completed. This potentially brings the Brazilians behind 3G closer to KO and we believe that this creates pressure on the KO board to continue to deliver increased shareholder value,” the analyst continued.
According to TipRanks.com, analyst Ian Shackleton has a total average return of 4.5% and a 78% success rate. Shackleton has a 7% average return when recommending KO, and is ranked #985 out of 3700 analysts.
The overwhelmingly majority of experts say Coca-Cola is a “buy.” The average forecast is for the stock to hit $49.80 in the coming months, according to data compiled by TipRanks.
Ulta Salon, Cosmetics & Fragrance, Inc.
Ulta Salon shares jumped nearly 14% in pre-market trading after the company topped fourth-quarter expectations and offered upbeat guidance. In reaction, Nomura analyst Simeon Siegel raised the price target for the stock to $189 (from $182), while reiterating a Buy rating.
Siegel observed, “Maintaining its streak of beating and guiding above, ULTA is managing to post accelerating comps, continuing to take share within the low- to mid-tier market, and we continue to expect that with minimal mall and ecomm penetration, ULTA remains isolated from the main issues facing retail as the company’s self-help initiatives drive ongoing top- and bottom-line growth. Despite its obviously high multiple, we expect EPS to grow faster than its multiple contracts and expect shares to continue compounding.”
According to TipRanks.com, a site that tracks and ranks analysts on their predictions, analyst Simeon Siegel has a total average return of -2.4% and a 42% success rate. Siegel has a 7.4% average return when recommending ULTA, and is ranked #2714 out of 3700 analysts.
Out of the 15 analysts polled by TipRanks, 11 rate Ulta Salon stock a Buy, while 4 rate the stock a Hold. With a return potential of 15%, the stock’s consensus target price stands at $188.14.