Post Holdings (POST) PT Raised to $131 at Evercore ISI

Evercore ISI analyst David Palmer raised the price target on Post Holdings (NYSE: POST) to $131.00 (from $129.00) while maintaining a Outperform rating.

The analyst comments "Egg-cellent EBITDA delivery... Following another stronger-than-expected quarter from Post’s foodservice division (33% of EBITDA; 5% long-term growth), we are increasing our FY26 and FY27 EBITDA estimates by 3% and 1%, respectively. That division (largely the Michael Foods egg business) is growing through a shift to value-added eggs (~30% of Michael Foods’ sales; up ~2pp YoY; ~4x the margin of cracked eggs) and through gains with key channels (specialty coffee and convenience). This upside—together with prudent cost management in Post Consumer Brands (49% of EBITDA), and synergies from the 8th Avenue acquisition—is driving 2.5% EBITDA growth above a FY26 of “over-earning” from avian influenza helped pricing. ...And capital allocation as we anticipate stabilization in cereal and pet business; increasing target to $131. The company is using increased free cash flow to aggressively buy back shares (10% of shares in the last four months) while maintaining net leverage at 4.5x. With our higher EBITDA, we are nudging our price target higher (to $131 from $129) based on a sum-of-parts analysis (equal to 9x CY27 EV/EBITDA). This target valuation compares to the current center-store food average EV/EBITDA multiple of 10x. Post Holdings remains our favorite value name in Food. We continue to see upside likely depending on two major factors: 1) stabilizing Post Consumer Brands (PCB) trends (beginning with the high-margin cereal getting help from innovation next month), and 2) potential M&A."

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