Jefferies Cuts Price Target on Molson Coors (TAP), Volumes Remain Weak in U.S. as Inflation Rises
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Price: $42.94 +0.77%
Rating Summary:
8 Buy, 20 Hold, 6 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
8 Buy, 20 Hold, 6 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Jefferies is reaffirming its Hold rating on shares of Molson Coors (NYSE: TAP), which cutting its price target from $50 to $46.
Shares of TAP are currently trading well below their historical average as sales volumes in the U.S. continue to decline. Sales trends in Canada and the UK are improving, but as inflation headwinds look to move well into 2012 and as U.S. volumes show no signs of improvements, Jefferies doesn't anticipate any ramp up in shares.
An analyst at Jefferies comments, "Majority of 2011 COGS guidance reiterated with TAP still pointing to LSD and MSD inflation in U.S. and Canada, respectively. UK was the outlier with 2011 COGS guidance raised to +HSD from +MSD. TAP, in what could be an effort to offset COGS headwind, has reeled in some corporate spending, reducing 2011 MCI MGA& guidance to $190 million from $200 million."
Due to the extra week in the fourth quarter, Jefferies is raising its Q4 EPS estimate from $0.58 to $0.68 and its FY11 estimate from $3.48 to $3.49. For FY12, the firm is lowering its estimate from $3.72 to $3.69 on rising inflation and weak volume trends.
For more ratings news on Molson Coors click here and for the rating history of Molson Coors click here.
Shares of Molson Coors closed at $39.00 yesterday.
Shares of TAP are currently trading well below their historical average as sales volumes in the U.S. continue to decline. Sales trends in Canada and the UK are improving, but as inflation headwinds look to move well into 2012 and as U.S. volumes show no signs of improvements, Jefferies doesn't anticipate any ramp up in shares.
An analyst at Jefferies comments, "Majority of 2011 COGS guidance reiterated with TAP still pointing to LSD and MSD inflation in U.S. and Canada, respectively. UK was the outlier with 2011 COGS guidance raised to +HSD from +MSD. TAP, in what could be an effort to offset COGS headwind, has reeled in some corporate spending, reducing 2011 MCI MGA& guidance to $190 million from $200 million."
Due to the extra week in the fourth quarter, Jefferies is raising its Q4 EPS estimate from $0.58 to $0.68 and its FY11 estimate from $3.48 to $3.49. For FY12, the firm is lowering its estimate from $3.72 to $3.69 on rising inflation and weak volume trends.
For more ratings news on Molson Coors click here and for the rating history of Molson Coors click here.
Shares of Molson Coors closed at $39.00 yesterday.
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