TD Cowen analyst Robert Moskow has maintained their bearish stance on KLG stock, giving a Sell rating today.
Robert Moskow’s rating is based on a combination of factors that highlight challenges facing WK Kellogg Co. The company’s recent financial performance has been disappointing, with a notable decline in organic sales by 5.6% and a reduction in market share. This decline is attributed to a consumer shift towards healthier cereal options and value shopping, which WK Kellogg has struggled to address effectively.
Management’s efforts to adapt to these market changes, such as increasing marketing support for the Kashi brand and emphasizing ingredient simplicity, have not yielded significant results in the past. Additionally, the company’s sales guidance has been lowered, with expectations of a 2% to 3% decline, and EBITDA growth projections have been reduced significantly. Despite management’s assurances about future targets, these factors contribute to the Sell rating as they indicate ongoing challenges in regaining market traction and improving financial performance.
In another report released today, Morgan Stanley also maintained a Sell rating on the stock with a $17.00 price target.