Last month, J.M. Smucker (SJM) sold off sharply when fiscal second-quarter financial results failed to live up to Wall Street's expectations thanks to falling coffee sales, and the food company cut its sales estimate for the 2014 fiscal year, predicting a 2% decline.
Wells Fargo doesn't see things getting much better any times soon.
In a note published today, analysts John Baumgarter and Kristina Westura downgraded the stock to an Underperform from a Neutral, and now value the stock at $92 to $94 a share.
That's an 8% to 10% downside prediction for the stock.
Why? Baumgarter and Westura anticipate a challenging consumer environment, as well as slowing sales growth in the single-serve coffee market and easing tailwinds from cost deflation.
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So the Wells Fargo duo cut their per share earnings estimates for fiscal 2014 and 2015 to $5.72 and $5.74 respectively, from the previous forecast of $6.16 and $6.25.
Down 2% today to $102.74, Smucker has fallen since August when it hit a 52-week high of almost $115.
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