Deutsche Bank Suspends Price Target on Diamond Foods (DMND) on Delay in Q1 Results; Deal Renegotiation Possible
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Price: $16.65 +0.18%
Rating Summary:
0 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 21 | Down: 24 | New: 29
Rating Summary:
0 Buy, 12 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 21 | Down: 24 | New: 29
Trade DMND Now!
Deutsche Bank maintains a 'Hold' on Diamond Foods (NASDAQ: DMND), but suspends its price target.
Deutsche analyst, Eric Katzman, said, "With all concerned awaiting the Board's Audit Committee review on walnut payments and the resultant delay in F1Q12 results, we are temporarily suspending our PT on DMND...As financial results are unlikely before mid-Feb 2012, investors are left to speculate on what is likely to be a binary outcome for stock performance (i.e. accounting problems vs. Pringles deal completion)...Given the likely binary outcome once the Audit Committee relates its findings, the stock has been and probably remains highly volatile as investors try to decipher potential scenarios...Moreover, in our view, only investors with significant tolerance for risk should look at Diamond given current dynamics."
The Deutsche analyst calculates that the Pringles deal would be approx. 8% EPS accretive to DMND, however, considering recent news and DMND's stock price decline, Procter & Gamble (NYSE: PG) may ask for new terms which could influence accretion.
For an analyst ratings summary and ratings history on Diamond Foods click here. For more ratings news on Diamond Foods click here.
Shares of Diamond Foods closed at $29.69 yesterday, with a 52 week range of $26.37-$96.13.
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Deutsche analyst, Eric Katzman, said, "With all concerned awaiting the Board's Audit Committee review on walnut payments and the resultant delay in F1Q12 results, we are temporarily suspending our PT on DMND...As financial results are unlikely before mid-Feb 2012, investors are left to speculate on what is likely to be a binary outcome for stock performance (i.e. accounting problems vs. Pringles deal completion)...Given the likely binary outcome once the Audit Committee relates its findings, the stock has been and probably remains highly volatile as investors try to decipher potential scenarios...Moreover, in our view, only investors with significant tolerance for risk should look at Diamond given current dynamics."
The Deutsche analyst calculates that the Pringles deal would be approx. 8% EPS accretive to DMND, however, considering recent news and DMND's stock price decline, Procter & Gamble (NYSE: PG) may ask for new terms which could influence accretion.
For an analyst ratings summary and ratings history on Diamond Foods click here. For more ratings news on Diamond Foods click here.
Shares of Diamond Foods closed at $29.69 yesterday, with a 52 week range of $26.37-$96.13.
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