Barry Callebaut AG: Buy Rating Amid Cocoa Price Normalization and Undervaluation

Stifel Nicolaus analyst Cedric Norest reiterated a Buy rating on Barry Callebaut AG (BARN – Research Report) yesterday and set a price target of CHF1,100.00.

Cedric Norest has given his Buy rating due to a combination of factors influencing Barry Callebaut AG’s future performance. Despite a disappointing earnings release for the first half of 2025 and a reduction in full-year guidance, the normalization of cocoa bean prices is expected to improve the company’s free cash flow in the following year. This anticipated recovery in cash flow, coupled with the current undervaluation of the stock, suggests potential for significant upside.
Moreover, while the chocolate market has shown some vulnerability to price increases, the long-term demand remains robust, with chocolate being a leading flavor in food and beverage launches. The company’s shares have dropped significantly year-to-date, which Norest believes has already accounted for most of the negative factors. With a revised price target and an attractive valuation at 10x forward P/E, the stock presents a compelling investment opportunity as the market conditions stabilize.

In another report released on April 10, Kepler Capital also maintained a Buy rating on the stock with a CHF1,300.00 price target.

BARN’s price has also changed dramatically for the past six months – from CHF1522.000 to CHF771.500, which is a -49.31% drop .