Stifel hosted Mondelez International Inc (NASDAQ: MDLZ) CFO Luca Zaramella and IR Shep Dunlap for meetings with investors, which resulted in "increased confidence" in the company's ability to grow sales and profits.
Stifel's Christopher Growe maintains a Hold rating on Mondelez with a price target lifted from $48 to $52.
Mondelez's 90% product exposure to the snack category and 40% geographical exposure to emerging markets is "starting to shine through," Growe wrote in a note. Most notably, the company had a strong start to the fiscal year as it showed a nearly 3% category growth. The recent momentum gives management the benefit of the doubt to reinvest in the business, including new marketing/promotion, whitespace expansion, and product improvements
Growe said management's focus on the business is likely to sustain a growth rate that is inline with the category's growth at 3%. Encouragingly, this would make Mondelez a leader within the food industry in terms of growth and could prompt management to lift its sales growth beyond the current 2% to 3%.
If management were to lift its sales growth outlook beyond 3%, Growe said it would be viewed positively by investors and warrant a continued premium multiple.
Shares of Mondelez were trading around $54.79 Monday afternoon.
UBS Lifts Mondelez International Price Target Ahead Of Q1 Print
Mondelez CEO Talks State Of Snack Market With CNBC
See more from Benzinga
- BMO Says The Valuation Discount In Keurig Dr Pepper Is 'Too Large To Ignore'
- Nvidia Announces Support For Arm CPUs: Why It Matters
- Iran Says It Busted 'Large' CIA Spy Ring
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.