Wells Fargo Upgrades Hillshire Brands (HSH) to Market Perform

January 31, 2014 7:23 AM EST
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Price: $62.96 --0%

Rating Summary:
    0 Buy, 8 Hold, 1 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 5 | New: 13
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Wells Fargo upgraded Hillshire Brands (NYSE: HSH) from Underperform to Market Perform with a price target of $33-$34 (from $28-$30).

"We are upgrading shares of HSH to Market Perform from Underperform following FQ2's EPS beat ($0.66 vs. our in-line $0.50) and positive bias to FY14 EPS guidance; now near the "high end" of “flat to down MSD y/y” guidance. To be clear, FQ2 benefitted from favorable expense timing (lower MAP spend and corporate expense worth ~$0.10 vs. our model) and for FY14, we estimate advantageous corporate expense is worth $0.03-0.04/share. That said, the worst of the commodity storm has likely passed, productivity benefits are emerging, and we believe such savings are capable of limiting the potential downside risk to EPS over the next two quarters. Net, we increase our FY14E EPS to $1.69 from $1.61 and maintain our FY15E EPS at $1.90," said analyst John Baumgartner.

For an analyst ratings summary and ratings history on Hillshire Brands click here. For more ratings news on Hillshire Brands click here.

Shares of Hillshire Brands closed at $35.74 yesterday.

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