Citi opens ‘negative catalyst watch’ on Middleby, keeps Buy rating

Citi analyst Timothy Thein raised the firm’s price target on Middleby to $166 from $165 and keeps a Buy rating on the shares. The analyst also opened a “30-day negative catalyst watch” on Middleby, believing the company will lower near-term Commercial Foodservice equipment expectations. Supported by feedback from Citi’s U.S. dealer contacts, excess channel inventory has continued to build in recent months, the analyst tells investors in a research note. The firm says this is mainly the result of excessive ordering during periods of factory constraints and long lead times, which have since compressed. Rising interest rates has compounded the impact for dealers, which are now looking to destock, notes Citi. It believes this will likely result in lower production for Middleby in the near-term.