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J.M. Smucker (NYSE:SJM) stock fell 15% after TD Cowen lowered its price target to $105.00 from $121.00 on Tuesday, while maintaining a Hold rating on the food company. The stock, now trading near its 52-week low of $93.93, has declined nearly 16% in the past week alone, according to InvestingPro data.
The price target reduction follows J.M. Smucker’s disappointing earnings guidance for fiscal year 2026, projecting earnings per share of $8.50-$9.50, well below analyst expectations of $10.25. Despite current challenges, the company maintains a strong dividend profile, having maintained payments for 55 consecutive years with a current yield of 4.6%.
TD Cowen now forecasts EPS of $9.20 for FY26 and projects only 3% EPS growth to $9.50 in FY27, citing ongoing challenges with the company’s Hostess acquisition and difficulties in capturing more profit in its coffee segment. InvestingPro analysis indicates the stock is currently in oversold territory, with 12 additional exclusive insights available to subscribers.
The investment firm noted that while the conservative guidance may "derisk the stock to some degree," it expects J.M. Smucker to "remain in the penalty box" until the company demonstrates improvement in its troubled business segments.
Management indicated they believe the company can return to high-single-digit EPS growth by fiscal year 2027, but TD Cowen cautioned that "visibility is low" on achieving this target given current performance issues.
In other recent news, J.M. Smucker has been the subject of several analyst reports highlighting various challenges and adjustments. Stifel analysts lowered their price target for J.M. Smucker to $106.00 from $120.00, maintaining a Hold rating, after the company reported stronger-than-expected fourth-quarter results. Despite strong performance in its legacy business, driven by the Uncrustables brand and a resilient coffee portfolio, the Sweet Baked Snacks segment, including the Hostess brand, faced ongoing challenges. The company’s initial guidance for fiscal year 2026 projects an 11% decline in earnings per share, approximately 13% below Stifel’s previous estimate, due to factors like higher pricing impacts in the coffee business and lower profitability in the Sweet Baked Goods segment. Stifel subsequently adjusted its fiscal year 2026 earnings per share estimate to $8.95, a reduction of $1.43. Meanwhile, Bernstein also lowered its price target for J.M. Smucker to $94.00 from $104.00, citing concerns about the Hostess brand’s performance and potential headwinds from GLP-1 weight loss drug uptake. DA Davidson maintained a Neutral rating on the company, noting macroeconomic pressures and a poorly timed acquisition of Hostess Brands (NASDAQ:TWNK) as significant concerns. These developments underscore the challenges J.M. Smucker faces in the current market environment.
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