UPDATE: Morgan Stanley Initiates Kraft Foods Group at Equal-Weight; Yield Already Priced In

Morgan Stanley initiated coverage on Kraft Foods Group

with an Equal-weight rating and a $47 price target. Morgan Stanley noted, "KRFT's $2/share dividend and ~75% payout ratio are a unique asset within the large-cap US Food landscape, and should both limit near-term valuation downside and provide the prospect for further re-rating. … We acknowledge the attractiveness and relevance of KRFT's dividend payout, but we think non-yield based valuation metrics appear full at current levels (~16x 2013e P/E). Further, the company's plan not to provide EPS guidance could weigh on perceived EPS visibility." Kraft Foods Group closed at $44.10 on Monday.