BofA ups Vita Coco price target to $32, downgrades to Neutral

BofA analyst Bryan Spillane downgraded Vita Coco to Neutral from Buy with a price target of $32, up from $25, after the company reported Q2 results that were better than expected, with upside to the firm’s revenue, gross margin and EBITDA estimates. However, on the earnings call, management indicated that it expects to transition out of a private label supply agreement with a large customer during Q4 and the firm is lowering FY24 estimates due to the private label transition. With sales and EBITDA estimates coming down, “we struggle to see further appreciation in the medium term,” the analyst tells investors.