UPDATE: JPMorgan Starts Sovos Brands Inc (SOVO) at Overweight

JPMorgan analyst Ken Goldman initiates coverage on Sovos Brands Inc (NASDAQ: SOVO) with a Overweight rating and a price target of $17.00.

The analyst comments "We rate the SOVO shares Overweight. On the positive side, (1) the company’s brands are generally well-positioned to benefit from changing consumer trends (clean label, better ingredients, etc.), (2) Sovos generates solid free cash flow (which can be used to reduce debt and/or buy additional assets), and (3) we view the valuation as relatively appealing. On the less positive side, (1) the company’s brands outside Rao’s are somewhat unproven in terms of long-term growth potential, (2) the company participates in somewhat slowergrowth categories (which limits upside), and (3) Sovos may do a less-than-ideal acquisition (M&A is a stated strategy). All in, though, we find the brands, strategy, management team, and valuation sufficiently attractive to be Overweight. Based on the methodology detailed below, we see fair value of $17/share as of December 2022."

For an analyst ratings summary and ratings history on Sovos Brands Inc click here. For more ratings news on Sovos Brands Inc click here.

Shares of Sovos Brands Inc closed at $14.17 yesterday.

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