What Analysts Recommend for J.M. Smucker Stock



Analysts maintain their stance

Analysts continue to have a “neutral” outlook on J.M. Smucker (SJM) stock despite the company’s better-than-expected fiscal 3Q18 earnings and higher profitability guidance. Its top line is expected to benefit from new coffee product launches and strength in the Jif, Smucker’s, and Nature’s Recipe brands. However, management’s tepid fiscal 2018 sales outlook on the back of competitive pricing in coffee and challenges in the U.S. Retail Consumer Foods segment is expected to restrain its top-line growth rate.

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The company’s fiscal 2018 EPS (earnings per share) is expected to benefit from increased cost and productivity savings, coupled with lower green coffee costs. A lower effective tax rate is also likely to cushion its bottom line. However, continued cost pressure on its margins from higher freight charges is anticipated to remain a drag. The company lowered its gross margin forecast, expecting higher logistics costs and an unfavorable mix.

Ratings and price target

Of the 18 analysts providing recommendations for J.M. Smucker stock, 61% recommend a “hold.” About 22% of them recommend a “buy” for the stock, and 17% recommend a “sell.” Analysts suggest a price target of $128.73, which represents an upside potential of 3.4% compared to its closing price of $124.46 on Friday, February 16, 2018.

Analysts have a “neutral” outlook for General Mills (GIS), Hershey (HSY), Campbell Soup (CPB), and Kellogg (K). On the other hand, analysts remain upbeat on Mondelēz (MDLZ), Conagra Brands (CAG), and Kraft Heinz (KHC).


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