2 Stocks With Upgrades: Mead Johnson, Bunge
NEW YORK (
) --
Mead Johnson
(MJN)
and
Bunge
(BG) - Get Report
were upgraded to buy by
TheStreet Ratings
on Tuesday.
|
Mead Johnson Nutrition
The infant formula company reported last month fourth-quarter earnings of $85.6 million, or 42 cents a share, down from year-earlier earnings of $99.6 million, or 48 cents.
"By leveraging its strong brands, research and development expertise, and favorable geographic footprint, MJN should grow revenues to about $5.8 billion by 2016, a 9-10% five-year CAGR, 2% faster than the 7-8% growth projected for the $24 billion pediatric nutrition industry," Gabelli analysts wrote in a Feb. 10 report.
Shares of Mead Johnson Nutrition were upgraded to
by
TheStreet Ratings
.
"The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, expanding profit margins and solid stock price performance,"
TheStreet Ratings
wrote. "We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Mead Johnson has an estimated price-to-earnings ratio for next year of 21.01; the average for food products companies is 13.84. For comparison,
General Mills
(GIS) - Get Report
and
J.M. Smucker
(SJM) - Get Report
both have lower forward P/Es of 13.93 and 14.17, respectively.
Ten of the 16 analysts who cover Mead Johnson Nutrition rated it a buy. Six analysts gave it a hold rating.
TheStreet Ratings
gives Mead Johnson Nutrition a B- grade with a
price target. The stock has risen 10.01% year to date.
Bunge
The agricultural and food company reported last week fourth-quarter earnings of $254 million, or $1.65 a share, which fell from year-earlier earnings of $301 million, or $1.95.
"U.S. oilseed processing profitability was the biggest drag on the quarter'searnings, resulting in a 46% yoy decline in Agribusiness segment
earnings before interest and taxes," Bank of America Merrill Lynch analysts wrote in a report Monday. "Despite the steep decline in segment profit, management indicated it took a cautious approach to the difficult merchandising market conditions and the weak results were better than those of peers ADM and Cargill."
Shares of Bunge were upgraded to
by
TheStreet Ratings
.
"The company's strengths can be seen in multiple areas, such as its robust revenue growth, attractive valuation levels and good cash flow from operations,"
TheStreet Ratings
wrote. "We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Bunge has a forward P/E of 8.76; the average for food product companies is 13.84. For comparison,
Sara Lee
( SLE) and
Hershey
(HSY) - Get Report
both have higher forward P/Es of 18.64 and 17.62, respectively.
Seven of the 13 analysts who cover Bunge rated it a buy. Five gave it a hold rating and one rated it a sell.
Bunge gets a B- grade with a
price target. The stock has increased 12.94% year to date.
-- Written by Alexandra Zendrian
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