Jefferies Cuts Price Target on ConAgra Brands (CAG) Following LW Spinoff
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Jefferies maintained a Buy rating on ConAgra Brands (NYSE: CAG), and cut the price target to $43.00 (from $56.00), following the LW spinoff. Estimates are unchanged and remain in line with mgmt’s LT guidance. Mgmt is guiding to 1-2% annual sales growth, 4-5% EBIT growth, ~10% EPS growth and ~12% annual TSR after dividends.
Analyst Akshay Jagdale commented, "With the LW spinoff now complete, we are reintroducing our estimates for CAG Brands & establishing a $43 PT. We continue to like CAG owing to: 1) attractive LT margin expansion opportunity; 2) significant cash generation potential from asset sales using $4.2B tax loss carry-forward; 3) portfolio reshaping efforts & increased focus should improve LT growth profile; 4) M&A optionality; and 5) attractive valuation relative to peers. We reiterate our Buy rating."
Shares of ConAgra closed at $37.72 yesterday.
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