BMO Calls Snyder's-Lance A 'Diamond In The Rough'; Upgrades To Outperform

BMO Capital Markets' Amit Sharma upgraded Snyder's-Lance Inc LNCE to Outperform, raising the price target to $40. The rating change came a week and a half after Snyder's CFO Rick Puckett retired without an immediate replacement.

Lack Of Visibility Creates An Entry Point

The analyst upgraded Snyder's-Lance as a result of "improving operating outlook, particularly with the DMND acquisition, coupled with the recent underperformance in Snyder's Lance shares."

Sharma believed the company's lack of visibility on the expected results from the DMND acquisition "have created an attractive entry point" as "persistent" investors dumped the stock. Sharma estimated the DMND acquisition to generate $70-80 million of revenue synergies "over the next three years."

Additionally, "better quality, brand building investments and innovation capabilities should finally unlock the underlying growth potential of its attractive portfolio," said the analyst.

Snyder-Lance traded at $32.98, up 3.39 percent on Thursday.