Analyst Lisa De Neve of Morgan Stanley maintained a Sell rating on Tate & Lyle, retaining the price target of p500.00.
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Lisa De Neve’s rating is based on several factors impacting Tate & Lyle’s financial outlook. The company has recently observed a decline in market demand, particularly over the past two months, which has led to a reduction in their profit guidance for the first half of the fiscal year 2025/26. This slowdown has prompted Tate & Lyle to lower their sales and EBITDA forecasts for the full year, indicating a decrease of low single digits year-over-year. The adjustments imply a more significant downgrade to the consensus estimates for sales and EBITDA, with a notable 12% reduction expected in the first half’s EBITDA.
Furthermore, the slowdown in demand is not isolated to Tate & Lyle but is more pronounced compared to its peers in the ingredient sector. This suggests that the company’s shares may underperform relative to the sector. Despite some positive developments, such as initial success in cross-selling efforts, the overall outlook remains cautious. These factors combined have led Lisa De Neve to issue a Sell rating, anticipating that the company’s stock may continue to face downward pressure.
Based on the recent corporate insider activity of 12 insiders, corporate insider sentiment is positive on the stock. This means that over the past quarter there has been an increase of insiders buying their shares of TATE in relation to earlier this year.