Nestlé: RBC upgrades rating to 'outperform

(CercleFinance.com) - RBC announced on Thursday evening that it had upgraded Nestlé shares from 'sector perform' to 'outperform', while maintaining its target price for them at 93 Swiss francs, saying that it sees an attractive risk/reward profile in the stock.


The Canadian broker is particularly encouraged by recent statements by new CEO Laurent Freixe that the Swiss food group's objectives must be 'realistic'.

From the broker's viewpoint, this should include recognition that achieving annual organic growth of between 4% and 6% over the medium term is not going to be an easy task.

RBC also appreciates Laurent Freixe's observation that if the cake doesn't get any bigger, his group could always take a bigger slice of it, an allegory it says it understands in view of the current difficult consumer environment.

That said, the broker also expects Nestlé, as market leader, to make the cake bigger.


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