The impact of the pandemic on first half earnings was less than Credit Suisse anticipated. The broker was surprised that Indonesian EBIT broke even despite a -19% drop in volumes and applauds the company’s efforts.
The broker no longer projects losses for Indonesia and factors in $70m for the company’s new cost savings program. NZ volumes and price assumptions are also upgraded.
Rating is upgraded to Outperform from Neutral and the target is raised to $11.25 from $9.00.
Sector: Food, Beverage & Tobacco.
Target price is $11.25.Current Price is $9.28. Difference: $1.97 – (brackets indicate current price is over target). If CCL meets the Credit Suisse target it will return approximately 18% (excluding dividends, fees and charges – negative figures indicate an expected loss).