Ahead Of The Bell: Analyst Upgrades Ralcorp

NEW YORK (AP) — An analyst boosted his rating on Ralcorp Holdings Inc. Wednesday, saying the food maker may meet or beat his earnings forecasts for 2009 and 2010.

Jon Andersen of William Blair & Co. upgraded the St. Louis-based company to "Outperform" from "Market Perform," saying Ralcorp may be able to benefit from its Post cereal acquisition soon.

"We see the potential for branded cereal volume trends to begin to improve sequentially with a full shipping schedule and more active promotional calendar, and for margins to move higher with the company shedding extra costs of a transition services agreement," Andersen wrote in a client note.

Ralcorp bought the Post cereals business from Kraft Foods Inc. in August 2008 for about $2.6 billion. The deal included the issuance of Ralcorp stock and the assumption of $950 million in debt.

The analyst predicts 2009 profit of $4.65 per share and 2010 net income of $5.10 per share.