NEW YORK (AP) -- A Stifel Nicolaus analyst on Thursday raised his price target for Kraft Foods by $6 to $55, saying that its profitability is on the rise and should continue to boost its earnings.
THE OPINION: Christopher Growe, who also backed his "Buy" rating for the stock, said that Northfield, Ill.-based Kraft, whose brands include Oscar Mayer and Miracle Whip, is in the early stages of profitability improvements that should result in continued earnings growth of at least 8 to 9 percent.
Growe projected a 2013 profit of $2.80 per share, above average analysts' estimates of $2.76 per share, saying that the company will get a boost from modest cost inflation, volume growth, lower overhead and productivity savings.
In 2014 the analyst expects earnings of $3.15 per share, while analysts polled by FactSet expect $3.11 per share. He added that the company will benefit from lower restructuring costs.
THE SHARES: Kraft Foods Inc. rose 13 cents to $51.49 in morning trading after climbing as high as $51.70 earlier in the session. Over the past 52 weeks, the stock has traded between $42 and $52.29.
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