On Wednesday, Citi adjusted its price target on shares of Mondelez (NASDAQ:MDLZ) International, traded on NASDAQ:MDLZ, raising it to $80 from the previous target of $79, while retaining a Buy rating for the stock. The firm anticipates Mondelez to unveil its third-quarter earnings for the year 2024 on October 29. According to Citi's projections, the company's organic sales growth and earnings per share (EPS) for the third quarter are expected to surpass the consensus estimates.
The firm, however, cautions that Mondelez's forward-looking statements, particularly regarding earnings for the upcoming quarters, might reflect a degree of caution. This caution is attributed to the significant rise in cocoa inflation anticipated to begin in the fourth quarter, which could potentially restrain the positive impact of the upcoming earnings report.
Citi remains optimistic about Mondelez's stock for the long term, despite the near-term challenges posed by cocoa price inflation. The firm's analysis suggests that while the immediate future may present some hurdles, the overall outlook for Mondelez's shares remains positive.
Investors are closely watching Mondelez International's upcoming earnings report, which will provide further insight into the company's financial health and its ability to navigate the inflationary pressures on raw materials such as cocoa. Citi's raised price target reflects confidence in the company's performance, balanced with a realistic assessment of the challenges it faces in the near term.
In other recent news, Mondelez International, Inc. has made notable strides in its business operations. The company agreed to acquire a majority stake in Evirth, a leading Chinese manufacturer of frozen-to-chilled cakes and pastries, pending regulatory approval. This acquisition aligns with Mondelez's strategic focus on expanding its presence in the cakes and pastries category.
In addition, Mondelez issued $500 million in senior notes due 2034, part of a broader Registration Statement on Form S-3.
Mondelez has also announced strategic partnerships with Lotus Bakeries and BISCOFF to expand its biscuit business in India. The company reported strong financial performance, with profit growth and $1.5 billion in free cash flow, despite a volume mix decline in developed markets.
In terms of analyst actions, Goldman Sachs initiated coverage on Mondelez with a Buy rating. Piper Sandler adjusted its price target to $78.00, maintaining an Overweight rating, while DA Davidson revised its target to $75 from $80, maintaining a Buy rating.
These are recent developments in the company's ongoing operations.
InvestingPro Insights
Mondelez International's financial metrics and market performance offer additional context to Citi's analysis. As of the latest data, Mondelez boasts a market capitalization of $94.64 billion, reflecting its significant presence in the snack food industry. The company's P/E ratio stands at 24.21, while its adjusted P/E ratio for the last twelve months as of Q2 2024 is 19.71, indicating a relatively moderate valuation compared to earnings.
Mondelez has demonstrated solid financial performance, with revenue for the last twelve months as of Q2 2024 reaching $35.98 billion. The company's profitability is noteworthy, with a gross profit margin of 40.34% and an operating income margin of 18.42% for the same period. These figures align with Citi's optimistic long-term outlook on the stock.
InvestingPro Tips highlight Mondelez's strong dividend profile. The company offers a dividend yield of 2.65% and has shown impressive dividend growth of 22.08% over the last twelve months as of Q2 2024. This robust dividend policy could be attractive to income-focused investors, especially given the current market conditions.
For readers interested in a more comprehensive analysis, InvestingPro offers additional tips and insights on Mondelez International. Currently, there are 15 more tips available on the platform, providing a deeper dive into the company's financial health and market position.
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