Analyst Peter Galbo from Bank of America Securities maintained a Sell rating on Campbell Soup and keeping the price target at $30.00.
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Peter Galbo has given his Sell rating due to a combination of factors impacting Campbell Soup’s financial outlook. Despite the company’s first-quarter earnings per share surpassing expectations, the overall gross margin fell short, and the fiscal year guidance remains heavily reliant on the second half’s performance. The company’s valuation is discounted compared to its peers, reflecting concerns over the execution risks associated with stabilizing its Snacks segment amidst ongoing tariff-related and core inflation pressures.
Additionally, the acquisition of a stake in La Regina, while potentially beneficial in the long term, is expected to be neutral to earnings in the near term. There are also concerns about the timing of this acquisition given Campbell Soup’s current focus on cash flow and debt reduction. The competitive pressures in the Snacks category and the expected decline in gross margins in the second quarter further contribute to the cautious outlook, supporting the Sell rating.
In another report released yesterday, Barclays also maintained a Sell rating on the stock with a $30.00 price target.
CPB’s price has also changed moderately for the past six months – from $34.270 to $28.470, which is a -16.92% drop .