BMO Capital lowers Primo Brands stock price target on integration challenges

Published 08/08/2025, 12:40
BMO Capital lowers Primo Brands stock price target on integration challenges

Investing.com - BMO Capital has lowered its price target on Primo Brands Corp. (NYSE:PRMB) to $42.00 from $45.00 while maintaining an Outperform rating. According to InvestingPro data, the stock is currently trading below its Fair Value, with analyst targets ranging from $32 to $48.

The price target reduction follows disappointing second-quarter results and 2025 guidance from the company, which faced multiple challenges including integration issues, tornado and weather disruptions, dispenser problems, and timing of its coffee business exit. The stock has reflected these challenges, declining over 27% in the past six months, despite maintaining a solid revenue growth of nearly 21% over the last twelve months.

BMO Capital noted that the market will need confidence that Primo Brands has appropriately accounted for second-half 2025 implications of these integration issues, particularly regarding cost and customer recovery cadence.

Despite these concerns, the research firm views these challenges as transitory with limited impact on 2026 and beyond, noting that Primo Brands expects to exit 2025 re-aligned with its algorithm.

BMO Capital remains constructive on the company’s multi-year outlook, pointing to potential incremental growth opportunities from recapturing non-recurring revenue losses and costs in 2026.

In other recent news, Primo Water Corporation reported its Q2 2025 earnings, significantly surpassing analysts’ expectations. The company achieved an earnings per share (EPS) of $0.36, compared to the anticipated $0.26, reflecting a 38.46% positive surprise. Additionally, Primo Water’s revenue reached $1.73 billion, far exceeding the forecasted $502.1 million, marking a 244.55% surprise for analysts. Despite these strong financial results, the company’s stock experienced a decline in trading. These developments are part of recent updates about Primo Water, highlighting its financial performance. Investors might find these earnings and revenue outcomes noteworthy, given the substantial differences from expectations. The company’s ability to exceed forecasts could be a point of interest for stakeholders monitoring its progress.

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