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Analysts’ Recommendations for Campbell Soup Stock

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Updated

Ratings and target price summary

Most of the analysts covering Campbell Soup (CPB) maintain a “hold” rating on the company’s stock given its lackluster performance and persisting challenges, which likely won’t end soon. Meanwhile, Amazon’s (AMZN) announcement of the Whole Foods (WFM) acquisition poses challenges. Analysts think that increased competition among retailers will squeeze food manufacturers’ margins. Analysts maintained a score of 3.2 on a scale of 1.0 representing “strong buy” to 5.0 representing “strong sell” on Campbell Soup stock.

Of the 17 analysts providing recommendations on Campbell Soup stock, 12.0% rated it as a “buy,” 59.0% maintained a “hold,” and 31.0% rated it as a “sell.” On July 6, 2017, Campbell Soup was trading ~12% below analysts’ 12-month target price of $57.79.

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Peer comparisons

In comparison, analysts have a positive outlook on Tyson Foods (TSN) and Conagra (CAG) stock. As for Tyson Foods, 69.0% of the 13 analysts covering the stock rated it as a “buy,” 23.0% maintained a “hold,” and 8% rated it as a “sell.” Meanwhile, of the 14 analysts covering Conagra stock, 64.0% recommended a “buy,” 22.0% maintained a “hold,” and 14.0% provided a “sell” rating.

Valuation summary

On July 6, 2017, Campbell Soup was trading at a 12-month forward PE (price-to-earnings) multiple of 16.3x, which is well below the S&P 500 Index’s (SPX) forward PE multiple of 18.0x and the Consumer Staples Select Sector SPDR ETF’s (XLP) forward PE multiple of 21.0x.

Campbell Soup is trading at a discount compared to the peer group average of 17.8x. Peers including Kellogg (K), Tyson Foods, Conagra, Mondelez (MDLZ), and Hershey (HSY) were trading at forward PE multiples of 17.0x, 12.4x, 18.3x, 19.9x, and 21.6x, respectively, on the same date.

Note that the 12-month forward PE multiple tends to differ among companies based on numerous factors that include business model and capital structure, growth expectations, profitability, and risk-return profiles.

For more updates on Campbell Soup stock, visit Market Realist’s Consumer Staples page.

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