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RBC Capital, which has an Outperform rating on the stock, upped its price target for UTZ to $19 from $17 per share in a note, stating that the investor day exceeded their bullish expectations.
“UTZ revealed a comprehensive plan for its next phase of growth at last week’s Investor Day and provided 3-year financial targets that imply upside to RBCe/cons,” wrote analysts at RBC Capital. “Going forward, their strategy will revolve around penetrating expansion geographies, transforming the supply chain, developing enhanced organizational capabilities, and improving the balance sheet.”
Near-term headwinds aside, analysts at RBC Capital are increasingly confident that UTZ management is taking the right steps to “further transform the company into a best-in-class snacking pure-play that can better compete with market leaders.”
Piper Sandler also lifted its price target for UTZ, this time to $18 from $17 per share. Analysts at the firm said the three-year targets the company unveiled “look attractive and achievable.”
“We expect good category momentum (just 2-3% is assumed for its targets vs. 4-5% historically) and share gains in expansion geographies to drive strong top-line growth,” said analysts at Piper Sandler.
According to the firm, UTZ plans a greater focus on marketing spending and consumer insights behind its power brands, fueled by accelerating productivity savings.
“We expect automation, facility consolidation, and new mixing centers to drive productivity (three-year target: ~$135M),” they added. “We maintain our current estimates but believe there is likely upside to these (and to its targets) on a three-year view.”
