UBS Maintains a 'Neutral' on Dean Foods (DF); Healthy Near-Term, But L-T Rise in Commodities May Weigh

UBS maintains a 'Neutral' on Dean Foods (NYSE: DF) price target raised from $13.50 to $15.50.

Analyst, David Palmer, said, "Following Dean’s 1Q earnings, we are raising our estimates to reflect solid WhiteWave-Alpro division (WWA) performance and better than expected cost savings. Our 2012e EPS goes to $1.15 (+50% YOY; consensus $0.94) from $0.98, and our FY13e EPS is now $1.30 (+13% YOY; consensus $1.11) from $1.13."

"We continue to believe that moderating input costs and improving margins augers well for Dean in the near-term. However, despite a healthier near-term outlook, the realities of a compressed margin environment and sagging industry volume trends could ultimately weigh on Dean’s long-term profitability-particularly if commodity costs rise substantially in 2H12 as our dairy consultant believes."

For an analyst ratings summary and ratings history on Dean Foods click here. For more ratings news on Dean Foods click here.

Shares of Dean Foods closed at $14.15 yesterday.

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