ING – Citi rates the stock as Upgrade to Neutral from Sell

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As reported yesterday, the FY19 report missed consensus forecasts, and it was accompanied by guidance for a decline in profits for FY20. Following on from the share price shellacking that ensued post the release, Citi has upgraded to Neutral from Sell.

Forecasts have been slashed by -18%-19%. Price target reduces to $3.40 from $3.85. The two challenges for management are rising costs and slowing price increases, which creates a double whammy, the analysts explain.

The company is organising a Strategy Day on 22 October 2019. Longer term, the analysts highlight this company is operating inside a concentrated industry structure, where scale benefits are important.

Sector: Food, Beverage & Tobacco.

Target price is $3.40.Current Price is $3.34. Difference: $0.06 – (brackets indicate current price is over target). If ING meets the Citi target it will return approximately 2% (excluding dividends, fees and charges – negative figures indicate an expected loss).

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