UPDATE: Credit Suisse Reiterates Outperform Rating, Lowers PT on Mead Johnson Nutrition
In a report published Friday, Credit Suisse reiterated its Outperform rating on Mead Johnson Nutrition (NYSE: MJN), but lowered its price target from $84.00 to $76.00.
Credit Suisse noted, “Mead Johnson reported an even weaker 3Q than we expected and lowered guidance for 2012 in response to continued struggles in China. The root of the problem is that they misjudged the competitive environment when they took a price increase in June, which then led to bigger-than-expected market share declines (350 bps from peak-to-trough) and revealed bigger-than-expected inventory problems at their distributors. The apologetic tone on the call indicates that management now blames itself for miscalculating the competitive environment in China and losing control of their distributors rather than the environment itself - a good first step toward the path to enlightenment, in our view. But with such poor visibility into the timing of a turnaround (other than the prospect of much easier comparisons in the back half of 2013), we think that the valuation multiple will be re-rated lower for at least six months.”
Mead Johnson Nutrition closed on Thursday at $63.53.
Latest Ratings for MJN
|Sep 2016||Goldman Sachs||Maintains||Neutral|
|Aug 2016||UBS||Initiates Coverage on||Neutral|
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