UPDATE: Goldman Sachs Downgrades Mondelez International (MDLZ) to Buy
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Goldman Sachs analyst Jason English downgraded Mondelez International (NASDAQ: MDLZ) from Conviction Buy to Buy with a price target of $71.00 (from $70.00).
The analyst comments "2Q21 results reinforce our view that MDLZ has succeeded in driving a sustainable top line acceleration for the company that should support durable top-tier bottom line growth relative to Food peers. In fact, after five years of modest 1-2% organic sales growth, the company is on track to post its third year of 3%+ growth with an anticipated 3-yr CAGR of 4.1%; and we note that this is before its multiple higher-growth acquisitions begin to impact the company's overall organic growth trajectory. As such, we believe that MDLZ remains well positioned to outperform its Food peers, and we reiterate our Buy-rating as a result. We, however, remove the stock from our conviction list as (1) its 4+ year duration on our conviction list is sub-optimal for a list designed to reflect our freshest ideas and (2) we believe that industry-wide cost pressures compounded with risk of weaker volumes and higher promotions is likely to weigh on the Food group later this year. We believe that MDLZ will weather these headwinds far better than many peers, but nonetheless believe that upside for the stock may be contained if the food group falls further out of favor. Since adding MDLZ to our Conviction List on April 3, 2017 the stock has risen by 47% versus a 31% rise in the XLP Consumer Staples Index and an 87% increase in the S&P500 index."
Shares of Mondelez International closed at $63.34 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst PT Change, Downgrades
Related EntitiesGoldman Sachs Conviction Buy List, Goldman Sachs, Standard & Poor's
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