Analyst Robert Moskow of TD Cowen maintained a Hold rating on TreeHouse Foods, reducing the price target to $22.00.
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Robert Moskow has given his Hold rating due to a combination of factors impacting TreeHouse Foods. The company’s second-quarter sales growth surpassed management’s guidance, but a decline in volume and mix, along with concerns about category weakness and narrowing price gaps with branded products, have created uncertainties. Despite an EBITDA beat, the guidance for the third quarter was below consensus, and the annual outlook remained unchanged.
TreeHouse Foods experienced a decline in organic sales, although pricing growth provided some relief. Management anticipates that commodity-related pricing adjustments will offer benefits in the future. However, the company faces challenges such as negative volumes due to weaker category consumption, exiting lower-margin businesses, and product recalls. Additionally, TreeHouse has not yet shown the ability to leverage structural growth in private labels, as evidenced by recent plant closures and supply chain issues.
In another report released yesterday, Barclays also maintained a Hold rating on the stock with a $21.00 price target.
Based on the recent corporate insider activity of 27 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of THS in relation to earlier this year.