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Nestlé SA (CH:NESN)
:NESN
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Nestlé SA (NESN) AI Stock Analysis

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CH:NESN

Nestlé SA

(OTC:NESN)

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Outperform 72 (OpenAI - 4o)
Rating:72Outperform
Price Target:
CHF83.00
▲(16.90% Upside)
Nestlé's overall stock score is driven by its strong financial performance and stable valuation metrics. The technical analysis suggests neutral momentum, while the earnings call highlights both growth opportunities and challenges. The absence of significant corporate events keeps the focus on core financial and operational metrics.
Positive Factors
Negative Factors

Nestlé SA (NESN) vs. iShares MSCI Switzerland ETF (EWL)

Nestlé SA Business Overview & Revenue Model

Company DescriptionNestlé S.A., together with its subsidiaries, operates as a food and beverage company. The company operates through Zone Europe, Middle East and North Africa; Zone Americas; and Zone Asia, Oceania and sub-Saharan Africa segments. It offers baby foods under the Cerelac, Gerber, Nido, and NaturNes brands; bottled water under the Nestlé Pure Life, Perrier, and S.Pellegrino brands; cereals under the Fitness, Nesquik, cheerios, and Lion Cereals brands; and chocolate and confectionery products under the KitKat, Nestle L'atelier, Nestle Toll House, Milkybar, Smarties, Quality Street, Aero, Garoto, Orion, and Cailler brands. The company also provides coffee products under the Nescafé, Nespresso, Nescafé Dolce Gusto, Starbucks Coffee At Home, and Blue Bottle Coffee brands; culinary, chilled, and frozen foods under the Maggi, Hot Pockets, Stouffer's, Thomy, Jacks, TombStone, Herta, Buitoni, DiGiorno, and Lean Cuisine brands; dairy products under the Carnation, Nido, Coffee-Mate, and La Laitière brands; and drinks under the Nesquik, Nestea, Nescafé, and Milo brands. In addition, it offers food service products under the Milo, Nescafé, Maggi, Chef, Nestea, Stouffer's, Chef-Mate, Sjora, Minor's, and Lean Cuisine brand names; healthcare nutrition products under the Boost, Peptamen, Resource, Optifast, and Nutren Junior brands; ice cream products under the Dreyer's, Mövenpick, Häagen-Dazs, Nestlé Ice Cream, and Extrême brands; and pet care products under the Purina, ONE, Alpo, Felix, Pro Plan, Cat Chow, Fancy Feast, Bakers, Friskies, Dog Chow, Beneful, and Gourmet brands. The company was founded in 1866 and is headquartered in Vevey, Switzerland.
How the Company Makes MoneyNestlé generates revenue through a diverse range of products across multiple categories, primarily in food and beverages. The company employs a multi-channel revenue model that includes retail sales, e-commerce, and foodservice distribution. Key revenue streams are derived from popular product lines, including powdered and liquid beverages, pet care products, and dairy items. Nestlé also capitalizes on strategic partnerships with retailers and distributors to enhance market reach and accessibility. The company invests in innovation and product development to respond to consumer trends, such as health and wellness, which further contributes to its earnings through premium product offerings and brand loyalty.

Nestlé SA Earnings Call Summary

Earnings Call Date:Jul 24, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Feb 19, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a balanced overview of Nestlé's performance with positive elements like organic growth and market share improvements, but significant challenges remain, including market adjustments in China, expected margin declines in the second half, and free cash flow issues.
Q2-2025 Updates
Positive Updates
Organic Sales Growth
Nestlé delivered 2.9% organic sales growth in the first half of 2025, with pricing contributing 2.7% and a real internal growth (RIG) of 0.2%.
UTOP Margin Performance
The UTOP margin was 16.5% in the first half, slightly better than expectations despite FX and tariff headwinds.
Fuel for Growth Program
Nestlé is on track to deliver CHF 700 million in savings for 2025, with CHF 150 million recognized in the first half and over CHF 350 million expected in the second half.
Nespresso Growth
Nespresso delivered solid growth with positive pricing and RIG, maintaining momentum.
Market Share Improvements
Nestlé reported improved market share positions in multiple categories, including North America and Europe.
Negative Updates
China Market Challenges
Greater China impacted RIG negatively by 40 bps in Q2, necessitating a strategic shift from distribution to consumer demand focus.
Lower Second Half Margin Expectations
Nestlé expects significantly lower margins in the second half due to increased input costs, tariffs, and FX impacts.
Confectionery Elasticity Impact
Confectionery faced elasticity challenges due to double-digit pricing to offset commodity inflation.
VMS Strategic Review
A strategic review of mainstream and value VMS brands may lead to divestments due to weaker performance.
Free Cash Flow Challenges
Free cash flow was lower in the first half, impacted by working capital increases and FX headwinds.
Company Guidance
In the Nestlé Half-year 2025 Results Conference Call, the company maintained its full-year guidance despite facing increased headwinds. Organic sales growth for the first half of 2025 was reported at 2.9%, with a Real Internal Growth (RIG) of 0.2% and pricing growth at 2.7%. The first half saw a UTOP margin of 16.5%, a decline of 90 basis points, attributed to a 60 basis point decrease in gross margin and a 50 basis point increase in advertising and marketing expenditures. Foreign exchange movements, notably the Swiss franc strengthening by 10% against the dollar, impacted sales negatively. Despite challenges, the company remains committed to investing for growth through its ‘Fuel for Growth’ program, anticipating CHF 700 million savings for the year. The strategic focus remains on maintaining or improving market share across segments, with specific emphasis on driving consumer demand in Greater China and focusing on premium brands in the VMS category.

Nestlé SA Financial Statement Overview

Summary
Nestlé demonstrates strong profitability and cash flow generation, underpinning its stable financial position. Despite a slight dip in revenue growth and increased leverage, the company maintains healthy margins and cash flow metrics, which support its long-term financial health.
Income Statement
75
Positive
Nestlé's income statement shows mixed performance. The gross profit margin stood at approximately 46.9% in 2024, indicating strong profitability. However, the net profit margin decreased slightly to 11.9% from 12.0% in 2023, reflecting some pressure on net income despite stable revenues. Revenue growth was negative at -1.7% from 2023 to 2024, which is a concern for future growth trajectory. EBIT and EBITDA margins are healthy at 16.1% and 20.3%, respectively, signaling operational efficiency.
Balance Sheet
70
Positive
The balance sheet reveals a moderate financial position with a debt-to-equity ratio of 1.77, up from 1.54 last year, indicating increased leverage. The equity ratio stands at 25.8%, a decline from previous years, showing reduced equity as a percentage of total assets. However, the return on equity decreased to 30.3% from 31.4%, reflecting a slight drop in profitability for shareholders.
Cash Flow
80
Positive
Nestlé's cash flow statement highlights strong free cash flow generation with a 10.0% growth rate from 2023 to 2024. The operating cash flow to net income ratio is robust at 1.53, indicating efficient cash generation from operations. The free cash flow to net income ratio was also solid at 0.98, showcasing effective capital management.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue90.90B91.72B93.35B94.78B87.47B84.68B
Gross Profit42.41B43.05B43.02B43.03B42.00B41.71B
EBITDA18.04B18.66B17.80B16.08B15.20B18.37B
Net Income10.30B10.88B11.21B9.27B16.91B12.23B
Balance Sheet
Total Assets130.12B139.26B126.55B135.18B139.14B124.03B
Cash, Cash Equivalents and Short-Term Investments5.51B7.87B5.85B6.69B14.04B8.61B
Total Debt65.60B63.56B55.24B54.31B46.89B40.04B
Total Liabilities101.08B102.57B90.16B92.39B85.42B77.51B
Stockholders Equity28.83B35.92B35.74B41.98B53.14B45.70B
Cash Flow
Free Cash Flow9.34B10.71B9.74B6.55B8.52B10.01B
Operating Cash Flow14.58B16.68B15.94B11.91B13.86B14.38B
Investing Cash Flow-6.88B-8.62B-6.20B-2.51B-3.65B-5.67B
Financing Cash Flow-7.29B-7.36B-9.76B-10.78B-8.55B-10.38B

Nestlé SA Technical Analysis

Technical Analysis Sentiment
Negative
Last Price71.00
Price Trends
50DMA
73.55
Negative
100DMA
78.58
Negative
200DMA
79.03
Negative
Market Momentum
MACD
-0.87
Positive
RSI
33.59
Neutral
STOCH
11.04
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CH:NESN, the sentiment is Negative. The current price of 71 is below the 20-day moving average (MA) of 73.27, below the 50-day MA of 73.55, and below the 200-day MA of 79.03, indicating a bearish trend. The MACD of -0.87 indicates Positive momentum. The RSI at 33.59 is Neutral, neither overbought nor oversold. The STOCH value of 11.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CH:NESN.

Nestlé SA Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
$180.15B17.8032.66%4.30%-1.32%-6.27%
70
Outperform
3.72B17.4422.16%2.41%10.78%10.53%
69
Neutral
1.70B16.9428.67%0.90%30.62%
64
Neutral
1.51B12.217.74%2.92%4.59%-3.22%
62
Neutral
$20.33B14.63-3.31%3.23%1.93%-12.26%
* Consumer Defensive Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CH:NESN
Nestlé SA
71.00
-11.25
-13.67%
GB:0MFY
ARYZTA AG
67.80
2.28
3.48%
EMLZF
Emmi AG
856.84
-154.63
-15.29%
GB:0RFX
Bell Food Group
240.00
-17.86
-6.93%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Sep 09, 2025