MTS – Morgan Stanley rates the stock as Upgrade to Overweight from Equal-weight

Morgan Stanley anticipates a strong update for April and May. The broker believes Metcash merits a higher multiple, given its earnings diversification and balance sheet strength.

Industry feedback suggests the company’s food business has taken share over the period of the lockdowns.

Morgan Stanley remains positive on the supermarket segment because of easing food deflation and discounters being less of a headwind.

Rating is upgraded to Overweight from Equal-weight and the target raised to $3.30 from $2.90. Cautious industry view.

Sector: Food & Staples Retailing.

Target price is $3.30.Current Price is $2.79. Difference: $0.51 – (brackets indicate current price is over target). If MTS meets the Morgan Stanley target it will return approximately 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).


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