Analysts maintain a neutral outlook
Analysts are keeping their neutral outlook on General Mills (GIS) stock after its fiscal 2019 first-quarter results. Susquehanna lowered its target price on the stock to $54 from $60. Piper Jaffray increased its target price to $47 from $45.
General Mills’ top line is projected to see healthy growth in fiscal 2019, driven primarily by its Blue Buffalo acquisition. However, its underlying sales could remain low. Its second-quarter sales are expected to mark a sequential decline, which is a concern. Inflation in input costs, high logistics costs, and higher interest expenses are likely to take a toll on its earnings.
Management expects price restructuring, cost-savings, and new products to support its base business. However, the rate of growth isn’t likely to impress.
Ratings and target price
Of the 19 analysts providing recommendations for General Mills stock, 14 of them are recommending a “hold,” four are rating it a “buy,” and one is recommending a “sell.” Analysts have a consensus target price of $48.53 per share on GIS stock, which indicates an upside of 10% based on its closing price of $44.13 on September 13.