Utz Brands (UTZ) PT Lowered to $21 at Mizuho

Mizuho analyst John Baumgartner lowered the price target on Utz Brands (NYSE: UTZ) to $21.00 (from $24.00) while maintaining a Outperform rating.

The analyst commented: "Pricing Challenging but Volume on Track: Maintain Outperform: Q3's in-line EPS & reiteration of FY24 guidance was encouraging given concerns that aggressive summer 2024 salty snacks category price discounting would yield a larger destabilization on the model. Pricing is unsurprisingly likely to remain soft, but new distribution supports volume share growth in "expansion markets" and reinvestment, seasonal programming, and package size adjustments in core markets maintain UTZ's capacity for 3%+ organic sales in FY25E. Productivity savings reinforce our confidence that the balance of risks to EBITDA is biased to the upside. Reduced expectations for pricing temper our FY25E sales and adj. EBITDA ($220MM from $230MM), and we reduce our PT ($21 from $24) on ‾1.7x our CY23-CY25E PEG (10% discount vs. Staples growth peers). We maintain our "salty over sweet" investment thesis, for domestic snacking exposure, and reiterate our high confidence in UTZ's superior growth-compounding capacity."

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