2016-09-27 10:57:03 | J.M. Smucker downgraded on sales declines, pet food woesCredit Suisse downgraded J.M. Smucker (SJM) to Neutral from Outperform, saying that it had previously underestimated a number of problems faced by the company. The firm lowered its price target on the stock to $145 from $158. DECLINING SALES: Credit Suisse analyst Robert Moskow said he previously underestimated the sales declines that J.M. Smucker would suffer as a result of difficult comparisons it's facing. The comparisons are tough because of new products the company introduced last year, Moskow stated. Nielsen tracking data shows that J.M. Smucker's comparative sales fell 2.2% in the past four weeks, marking a deceleration from the previous 12 weeks, when comps fell 1.4%. PET PRODUCT PROBLEM: Several of J.M. Smucker's recent pet snack launches have "failed to gain traction," the sales of its Nature's Recipe pet products have fallen, and the sales of its dry dog food continue to decelerate, the analyst reported. The company will probably have to lower its near-term profit guidance and long-term sales growth guidance for the pet unit, Moskow warned. PRICE ACTION: In morning trading, J.M. Smucker fell nearly 3% to just below $134 per share. |
---|