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Investing.com - Jefferies has initiated coverage on Primo Brands Corp. (NYSE:PRMB) with a Hold rating and a $23.00 price target. According to InvestingPro data, the stock is currently trading near its 52-week low of $21.37, suggesting potential value opportunity based on InvestingPro’s Fair Value analysis.
The investment firm cited Primo’s position at the "intersection of scale and structural growth," noting that the company’s route density delivers "monopoly-like economics" while its premium offerings maintain momentum.
Jefferies highlighted Primo’s growing cash flow optionality as providing additional flexibility and described the company’s long-term fundamentals as "solid," suggesting the business is worth more than its current valuation of 11 times 2027 earnings.
Despite these positive factors, Jefferies expressed concerns about integration complexity, which it believes limits near-term visibility for the company.
The firm indicated that Primo Brands needs to demonstrate "execution proof points" to achieve a market re-rating, a process that "may take some time," while also cautioning that Street expectations for the second half of the year appear too high.
In other recent news, Primo Brands Corp. reported its Q2 2025 earnings, which exceeded analyst expectations significantly. The company achieved an earnings per share (EPS) of $0.36, surpassing the forecasted $0.26, and reported revenue of $1.73 billion, far above the anticipated $502.1 million. Despite these strong results, the company faced challenges that impacted its stock performance. BMO Capital noted disappointing second-quarter results and reduced its price target for Primo Brands from $45.00 to $42.00, citing integration challenges and other disruptions.
TD Cowen maintained a Buy rating for Primo Brands, highlighting the company’s potential in generating free cash flow, despite recent service disruptions affecting its stock. Goldman Sachs initiated coverage with a Neutral rating and a $25.00 price target, recognizing Primo Brands’ significant presence in the bottled water market. These developments reflect the mixed sentiment among analysts regarding the company’s future prospects. Investors are closely watching how Primo Brands navigates its current challenges while leveraging its market position.
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