Campbell Soup Company is selling organic baby food and kids snacks brand Plum Organics to Sun-Maid Growers of California. Financial details of the transaction were not disclosed.
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Campbell Soup Company’s (CPB) President of Meals and Beverages, Chris Foley, said, “The sale of the Plum Organics baby food brand is part of our ongoing strategic process to create even greater focus on driving growth in the division’s core categories of soup, sauces and beverages.”
Harry Overly, CEO and President of Sun-Maid Growers of California, commented, “We are excited to welcome Plum Organics’ nutritious line of baby, toddler and kids’ food products to our imaginative world of delicious, whole fruit snacks.” (See Campbell Soup stock analysis on TipRanks)
Plum Organics was acquired by Campbell Soup in 2013. Its products cater to the nutritional requirements of babies, toddlers and kids and are certified organic and non-GMO. The transaction is expected to close in spring 2021.
This month, RBC Capital analyst Nik Modi reiterated a Buy rating on the stock with a $59 price target (17.4% upside potential).
Modi said, “CPB shares have performed well sinceMark Clouse joined the company as CEO. Most of the improvement has been a function of improving business trends against easy compares and a much more consistent delivery on earnings expectations.”
Modi further added, “However, we would argue that we are still in the early stages of a recovery. Yes, it will likely be choppy as stepped-up spending and reduced promotional intensity (against lots of promotions a year ago) create quarterly volatility, but we believe the company’s improved capabilities around consumer insights and R&D are just now starting to take hold.”
Turning to the rest of the Street, the stock has a Moderate Buy consensus rating alongside an average analyst price target of $52.57 (4.6% upside potential), based on 3 Buys, 3 Holds and 1 Sell. Shares have gained about 10.4% over the past year.
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