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On Monday, Mondelez International (NASDAQ:MDLZ), currently trading at $64.51, received an Overweight rating from Morgan Stanley (NYSE:MS), accompanied by a set price target of $69.00. The new coverage reflects the investment firm’s positive outlook on the company’s potential amidst a challenging market. According to InvestingPro analysis, the stock’s Fair Value assessment suggests it is currently fairly valued.
Morgan Stanley’s assessment points to Mondelez’s strategic positioning within the large-cap food industry, with a substantial market capitalization of $83.45 billion. The company has demonstrated steady growth with revenue reaching $36.44 billion and a 7% five-year revenue CAGR. The firm anticipates that Mondelez will experience an uptick in sales growth due to better market share results and a surge in its chocolate product line, bolstered by robust pricing strategies that have helped maintain a healthy 39.12% gross profit margin.
The analyst at Morgan Stanley acknowledges that Mondelez’s relative valuation may appear expensive when compared to historical data, but insists that the premium is justified. The firm’s forecast suggests a favorable risk-reward ratio, with expectations of a potential upside that substantially outweighs the downside risks. InvestingPro data shows the company maintains a "GOOD" overall financial health score, with particularly strong marks in profitability metrics.
Mondelez’s performance in the market will be closely watched as investors consider Morgan Stanley’s initiation of coverage. The firm’s confidence in the company’s growth prospects and pricing power may influence market sentiment towards the stock.
The $69.00 price target set by Morgan Stanley indicates their belief in Mondelez’s ability to thrive and deliver shareholder value, despite the current economic pressures facing the food industry at large. Mondelez, known for its popular snack brands, is thus positioned as an attractive investment option in its sector according to Morgan Stanley’s analysis.
In other recent news, Mondelez International has been the focus of several analyst updates and strategic announcements. Bernstein has raised its price target for Mondelez shares to $81, maintaining an Outperform rating, citing a favorable outlook for cocoa prices and the company’s successful mergers and acquisitions. Meanwhile, TD Cowen has increased its price target to $71, highlighting the benefits of declining cocoa costs and projecting earnings per share (EPS) of $3.15 for 2026. In contrast, Piper Sandler has lowered its price target to $56, maintaining a Neutral rating due to uncertainties in cocoa costs for 2026, and revising EPS estimates to $2.91 for 2025 and $3.20 for 2026.
Mizuho (NYSE:MFG) Securities has also adjusted its price target to $64, maintaining an Outperform rating, and noting the impact of cocoa inflation on Mondelez’s fiscal year 2025 guidance, which predicts a 14% year-over-year EPS decrease. Despite these challenges, Mizuho sees potential for recovery in 2026 through structural cost enhancements and distribution efforts. Additionally, Mondelez has outlined its growth strategy at the Consumer Analyst Group of New York Conference, reporting a 4.3% increase in organic net revenue for 2024 and emphasizing its expansion into the cakes and pastries market. The company aims to derive 90% of its revenue from core categories like chocolate and biscuits while exploring adjacent markets. These developments reflect the dynamic environment Mondelez is navigating, influenced by cocoa market trends and strategic growth initiatives.
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