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Fly News Breaks for April 2, 2019
K
Apr 2, 2019 | 08:50 EDT
After Kellogg announced a deal to sell its cookies business, including the Keebler brand, as well as its fruit and fruit-flavored snacks, pie crusts and ice cream cones businesses to Ferrero, Morgan Stanley analyst Dara Mohsenian said he believes the sale makes strategic sense given Kellogg's subscale positioning in cookies and fruit snacks and the businesses' declining revenue and slightly lower margins than the U.S. snacks average. He expects about 6% of EPS dilution in the next twelve months, assuming the proceeds are used to pay down debt, and lowering his 2019 EPS estimate for Kellogg by 3.2% and 2020 EPS view by 4.2%. Mohsenian keeps an Equal Weight rating on Kellogg shares.
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