Campbell Soup (CPB – Research Report), the Consumer Defensive sector company, was revisited by a Wall Street analyst yesterday. Analyst Peter Galbo from Bank of America Securities reiterated a Sell rating on the stock and has a $41.00 price target.
Peter Galbo has given his Sell rating due to a combination of factors impacting Campbell Soup’s financial outlook. The company’s second-quarter earnings were disappointing, with misses in organic sales and gross margin, leading to a reduction in full-year sales, profit, and adjusted EPS forecasts. Despite the new CEO Mick Beekhuizen’s cautious approach, challenges remain in the Meals & Beverages segment and the slower-than-expected recovery in the snacks division.
Additionally, the company’s long-term targets, such as achieving 2-3% organic sales growth, are now under scrutiny. The snacks segment, in particular, has been a significant factor in the revised outlook, with declines in sales and margins due to issues with third-party partners and specific brands like Goldfish and Snyder’s pretzels. Furthermore, disruptions in the SpaghettiOs supply chain and integration challenges with SOVO are expected to impact future performance. These elements contribute to a cautious view on the stock, prompting a reduction in the price objective to $41 and maintaining an Underperform rating.
In another report released yesterday, Barclays also maintained a Sell rating on the stock with a $40.00 price target.
CPB’s price has also changed moderately for the past six months – from $51.340 to $39.180, which is a -23.69% drop .
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