NEW YORK (TheStreet) -- Shares of Mondelez (MDLZ) - Get Report advanced on heavy trading volume on Tuesday after the company ended discussions late yesterday to combine with Hershey, PA-based snack confectionery manufacturer Hershey (HSY).
Morgan Stanley said that the development is a "net positive," according to a note cited by Barron's.
Abandoning the $23 billion Hershey bid should ultimately refocus the Deerfield, IL-based snack company's investors on its "compelling category footprint, peer-leading margin expansion and strategic potential as a standalone company," the firm noted.
Morgan Stanley initially had concerns over the "potential financial merits" of the acquisition, which was first introduced in July.
"Ultimately, with this overhang removed, we see potential for the stock to retrace recent weakness and trade closer toward our $50 price target," Morgan Stanley added.
More than 10.83 million shares were traded today vs. the 30-day average of 6.11 million shares.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "buy" with a ratings score of B.
The company's strengths can be seen in multiple areas, such as its notable return on equity, expanding profit margins, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth and increase in stock price during the past year. We feel its strengths outweigh the fact that the company shows weak operating cash flow.
You can view the full analysis from the report here: MDLZ