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Investing.com - JPMorgan has assumed coverage on WK Kellogg (NYSE:KLG) with a Neutral rating and raised the price target to $23.00 from $19.00. The stock currently trades at $22.96, near its 52-week high of $23.56, reflecting a strong year-to-date return of 30%. According to InvestingPro data, the company maintains a FAIR financial health score.
The firm cited risks to WK Kellogg’s multi-year margin targets, particularly in light of competitor General Mills (NYSE:GIS)’ planned investments in the cereal category.
JPMorgan noted that WK Kellogg’s outlook depends on improved volumes in the cereal category compared to current trends.
Despite these concerns, the firm emphasized that these factors have limited impact on the stock given the company’s pending acquisition by Ferrero.
The $23 per share acquisition price aligns with JPMorgan’s new price target, with the firm indicating there appears to be a low probability of regulatory challenges to the deal.
In other recent news, WK Kellogg Co has announced a quarterly dividend of $0.165 per share, payable on September 12, 2025, to shareholders of record as of August 29, 2025. The company has also declared its intention to remove synthetic dyes from its cereals, such as Froot Loops and Apple (NASDAQ:AAPL) Jacks, by the end of 2027. In a significant development, WK Kellogg has reached an agreement to be acquired by Ferrero for $23 per share, amounting to an enterprise value of $3.1 billion. This acquisition represents a 40% premium to the company’s 30-day volume-weighted average price prior to the announcement.
Following the acquisition news, TD Cowen upgraded WK Kellogg’s stock rating from Sell to Hold and increased its price target from $14.00 to $23.00. Similarly, Stifel raised its price target for the company to $23.00, maintaining a Hold rating. These recent developments highlight significant strategic changes and market responses regarding WK Kellogg’s position in the industry.
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