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Investing.com - Canaccord Genuity upgraded Collins Foods Ltd. (ASX:CKF) (OTC:CLLFF) stock rating from Hold to Buy on Wednesday, while raising its price target to AUD9.65 from AUD8.00, citing the company’s stronger-than-expected fiscal year 2025 results.
The research firm noted management’s confident outlook statements and detailed commentary regarding the health of the brand, ongoing business initiatives, and future growth drivers as key factors behind the upgrade decision.
Canaccord had previously maintained a Hold rating while waiting for evidence of stronger market conditions and improved margin execution in Australia, both of which the firm now believes are materializing for the food service operator.
The upgrade also acknowledges Collins Foods’ strategic initiatives, including scaling operations in Germany, resetting its Netherlands business, and exiting Taco Bell, which demonstrate management’s focus on capital deployment moving forward.
Canaccord views Collins Foods’ medium-term growth options as "broadly appealing" and suggests these could be further enhanced through potential inorganic growth opportunities.
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