On Thursday, J.M. Smucker Company's (NYSE:SJM) stock received an update from a market analyst at Jefferies. The firm has reduced its price target for the food manufacturer to $121 from $125, while maintaining a Hold rating on the shares. The adjustment comes ahead of the company's fourth fiscal quarter report scheduled for June 6th.
The analyst noted that investors are currently focusing on the potential fiscal year 2025 impacts from pet stranded overhead and the growth potential of the Sweet Baked Snacks segment. Despite the notable fourth fiscal quarter retail strength in products such as Uncrustables, Bustelo, and Meow Mix, this was counterbalanced by softer volumes in other brands including JIF, Folgers, and Dunkin'. Additionally, the analyst pointed out that Hostess and Milk-Bone volumes showed marginal changes, with a slight increase and decrease, respectively.
The revised earnings per share (EPS) estimates for the fourth quarter and fiscal year 2025 were decreased by approximately 2% and 1%, respectively. This revision takes into account the recent sales trends and the rise in coffee costs.
The analyst's commentary emphasized the mixed performance in J.M. Smucker's product portfolio, stating, "Notable FQ4 retail strength in Uncrustables, Bustelo, and Meow Mix, offset by softer volumes in JIF, Folgers, and Dunkin'." Furthermore, the analyst mentioned the volume changes in Hostess and Milk-Bone, "Hostess/Milk-Bone volumes +1%/(1%)."
In conclusion, the analyst from Jefferies reiterated the Hold rating for J.M. Smucker, reflecting a cautious outlook based on the latest sales data and cost considerations. The market will be watching closely for the company's upcoming fiscal report in June to gauge its performance and strategic direction.
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