David Hayes’s rating is based on several factors, primarily concerning the potential risk of a slowdown in key growth areas for DANONE SA.
Although recent performance in certain markets, such as the US dairy sector, has been strong, there are concerns about the sustainability of these trends moving forward.
The report highlights that while there may be stable performance in the immediate future, there are uncertainties regarding the company’s ability to maintain its sales growth and operational margin progression beyond 2025.
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Furthermore, the forecast adjustments, while slightly positive, do not significantly change the overall outlook. The marginal increase in Q4 organic growth and pricing adjustments suggest a cautious approach, as these changes do not substantially alter the competitive landscape or alleviate the concerns about long-term growth sustainability.
Therefore, the Sell rating reflects apprehensions about future growth prospects and the potential need for strategic adjustments to counteract these risks.
According to TipRanks, Hayes is ranked #2794 out of 9240 analysts.
In another report released on December 30, Bernstein also maintained a Sell rating on the stock with a €55.00 price target.
DANONE SA (0KFX) Company Description:
Following the acquisition of WhiteWave, Danone restructured the firm into three broad segments: essential dairy and plant-based products, which represents just over half of group revenue; specialised nutrition; and bottled water. The firm’s portfolio includes well-known brands such as Danone/Dannon dairy products, Nutrilon and Cow & Gate infant nutrition, and Evian and Volvic bottled water.
Danone derives about 60% of its annual sales outside Western Europe, up from about just one third in 2001.
