NEW YORK (TheStreet) -- JM Smucker (SJM - Get Report) has been initiated with an "equal-weight" rating and $101 price target, Morgan Stanley said Thursday. The firm said the company is facing accelerated K-Cup competition and commodity headwinds.
Separately, TheStreet Ratings team rates SMUCKER (JM) CO as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate SMUCKER (JM) CO (SJM) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, reasonable valuation levels, expanding profit margins, good cash flow from operations and increase in net income. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- SMUCKER (JM) CO has improved earnings per share by 12.0% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, SMUCKER (JM) CO increased its bottom line by earning $5.00 versus $4.06 in the prior year. This year, the market expects an improvement in earnings ($5.58 versus $5.00).
- 39.99% is the gross profit margin for SMUCKER (JM) CO which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 11.37% is above that of the industry average.
- Net operating cash flow has increased to $421.10 million or 29.96% when compared to the same quarter last year. Despite an increase in cash flow, SMUCKER (JM) CO's cash flow growth rate is still lower than the industry average growth rate of 52.64%.
- The net income growth from the same quarter one year ago has exceeded that of the Food Products industry average, but is less than that of the S&P 500. The net income increased by 8.1% when compared to the same quarter one year prior, going from $154.17 million to $166.70 million.
- You can view the full analysis from the report here: SJM Ratings Report