In a report released today, David Hayes from Jefferies maintained a Sell rating on Unilever, with a price target of p3,800.00.
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David Hayes has given his Sell rating due to a combination of factors impacting Unilever’s performance. One of the primary concerns is the decline in volume in the Latin American market, which has dropped by over 7%. This decline highlights the challenges associated with Unilever’s pricing strategy in hard currency markets and raises questions about the company’s ability to maintain its peak operating margins.
Additionally, while the company has shown impressive growth in the US market with a run rate exceeding 5%, this is overshadowed by the overall organic sales growth of 3.9%, which falls short of the mid-term guidance of 4-6%. The underperformance in Latin America dampens expectations for the fourth quarter, casting doubt on the feasibility of achieving the mid-term growth targets. These factors collectively contribute to the Sell rating assigned by David Hayes.
In another report released on October 17, UBS also reiterated a Sell rating on the stock with a p4,120.00 price target.