Evercore ISI Upgrades Hain Celestial (HAIN) to Outperform

Evercore ISI analyst David Palmer upgraded Hain Celestial (NASDAQ: HAIN) from In Line to Outperform with a price target of $48.00 (from $46.00).

The analyst comments "We are upgrading Hain Celestial to Outperform from In Line and raise our base case price target to $48 (up from $46) after a recent meeting with the company. Hain stock is down 16% since November 10 after its largest shareholder, Engaged Capital, sold 12.4M shares due to closing a fund. We believe this dislocation has created an opportunity ahead of accelerating sales growth starting in fiscal F2H22. Despite higher inflation and supply chain pressures, Hain is executing very well including improving measured channel consumption sales (most recent 12-week sales +8%; +14% 2-year). This strong consumption growth coupled with pricing (+6-10% in the US; int’l +3-4%) and distribution gains (personal care) gives us confidence that F2H22e sales can accelerate to high single digits (EVRe +8%; cons +7%). We are raising our consolidated FY22e organic sales estimate from +3% to 3.5% (cons +3%) and EBITDA to $273M (+5% YOY; cons $271M). We are also raising our FY23e consolidated organic sales from 4% to 4.5% (cons 4%) and EBITDA to $303M (+11% YOY; cons $302M). Our new $48 price target ($46 previously) is based on ~15x cal ‘23e EBITDA of $313M and a modest premium to center store food peers of 12x and SMID cap food of 13.5x, given still-ample productivity savings ($100M+), a strong balance sheet (~1x debt/EBITDA), and the potential for higher organic sales growth."

For an analyst ratings summary and ratings history on Hain Celestial click here. For more ratings news on Hain Celestial click here.

Shares of Hain Celestial closed at $40.78 yesterday.

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