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On Thursday, Piper Sandler increased the price target for Mondelez International (NASDAQ:MDLZ) shares to $59 from $56, while maintaining a Neutral rating on the stock. Currently trading at $66.33 with a market capitalization of $85.8 billion, MDLZ has posted an impressive 11.05% return year-to-date. The adjustment comes amid expectations of stronger pricing in the European Union, which is anticipated to lead to double-digit gains, surpassing the previous high single-digit estimates. According to InvestingPro analysis, the stock appears slightly undervalued based on its Fair Value assessment.
Mondelez’s EU pricing, which is still in the finalization stages and is expected to have a limited impact on the first quarter of 2025, is projected to be more robust than initially modeled. With annual revenue of $36.44 billion and a solid Financial Health Score of 2.72 (rated as GOOD) by InvestingPro, the company appears well-positioned to navigate these pricing adjustments. Piper Sandler has adjusted its forecasts to account for this improved pricing environment and softer EU volumes, noting that price elasticities have not raised concerns thus far. Additionally, the firm has updated its analysis to include the effects of U.S. retailer inventory destocking, which is assumed to have approximately a 2 percentage point impact on North America.
The company’s Mexican imports currently enjoy exemption under the United States-Mexico-Canada Agreement (USMCA) compliance. However, Mondelez could face significant exposure if this status changes, a risk that Piper Sandler believes is greater than previously estimated.
In light of these factors, Piper Sandler has revised its earnings per share (EPS) estimates for Mondelez, increasing its 2025 forecast from $2.91 to $2.92 and its 2026 projection from $3.20 to $3.35, primarily due to the anticipated stronger EU pricing. The new price target of $59 reflects approximately 17.5 times the firm’s estimated 2026 EPS for Mondelez. For deeper insights into Mondelez’s valuation metrics and growth potential, including exclusive ProTips and comprehensive financial analysis, check out the detailed Pro Research Report available on InvestingPro.
In other recent news, Mondelez International has been the focus of several analyst updates and strategic announcements. The company reported a 4.3% increase in organic net revenue and a 5.1% rise in adjusted gross profit dollars for 2024, despite facing significant cocoa input cost inflation. This performance was highlighted at the 2025 Consumer Analyst Group of New York Conference, where Mondelez outlined its growth strategy, particularly in the cakes and pastries sector, which is expected to accelerate further.
Analyst firms have also made notable adjustments to their price targets for Mondelez. Bernstein raised its price target to $81, maintaining an Outperform rating, citing a favorable outlook for the cocoa market and Mondelez’s international strengths. Meanwhile, TD Cowen increased its target to $71, emphasizing the benefits of declining cocoa prices on the company’s financials. However, Piper Sandler reduced its target to $56, attributing this to lower-than-anticipated guidance for 2025 and uncertainties surrounding 2026 cocoa costs.
Morgan Stanley (NYSE:MS) initiated coverage with an Overweight rating and a $69 price target, expressing confidence in Mondelez’s strategic positioning and potential sales growth. The firm’s positive outlook is based on Mondelez’s brand strength and pricing strategies, which are expected to enhance market share. As Mondelez navigates these market dynamics, its strategic focus on sustainable growth and value-enhancing acquisitions remains a key element of its approach.
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