Analyst David Hayes from Jefferies maintained a Sell rating on Unilever (ULVR – Research Report) and decreased the price target to p3,600.00 from p3,700.00.
David Hayes has given his Sell rating due to a combination of factors impacting Unilever’s growth prospects and profitability. Despite the company’s emphasis on achieving a mid-term sales growth target of 4-6%, recent performance indicators suggest challenges ahead. The CEO’s mention of a two-year compound annual growth rate of 3.7% as ‘competitive’ highlights the struggle to meet higher growth expectations.
Moreover, while emerging markets like India, China, and Indonesia are expected to contribute positively, the fading growth in developed markets raises concerns. Additionally, currency fluctuations have introduced a 20 basis point headwind on margins, and guidance from Hindustan Unilever indicates a year-over-year margin decline, further pressuring overall profitability. These factors collectively underpin the cautious outlook and the Sell recommendation.
According to TipRanks, Hayes is a 3-star analyst with an average return of 2.3% and a 54.97% success rate.
In another report released on April 25, UBS also maintained a Sell rating on the stock with a £40.00 price target.