Oscar Gruss Downgrades Diamond Foods (DMND) to Hold; Parsing A Walnutty Company Disclosure

Oscar Gruss downgraded Diamond Foods (NASDAQ: DMND) from Buy to Hold. Price target cut from $75 to $50.

Oscar analyst says, "DMND put out a short, sparse press release announcing that the acquisition of the Pringles snack business from Proctor and Gamble Co. (NYSE: PG) is now expected to close in the first half of 2012 (instead of during December 2011). The Company stated that the Chairman of the Board’s Audit Committee received an “external communication” regarding DMND’s accounting of certain crop payments to walnut growers. In response, DMND’s Audit Committee decided to perform an investigation of the matter. We do not see a way to interpret this development positively. The amount of information provided by DMND is minimal, the timing is inopportune and the downside of not completing the Pringles deal is material. The updated closing guidance of 1H CY12 does not inspire confidence."

For more ratings news on Diamond Foods click here and for the rating history of Diamond Foods click here.

Shares of Diamond Foods closed at $64.12 yesterday.

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