BRRLY - Barry Callebaut AG: Chocolate Maker In Potential Reversal

2025-03-28 10:20:27 ET

Summary

• Barry Callebaut AG, a Swiss/Belgian chocolate company, is undervalued at 15.8x P/E, presenting a significant investment opportunity with a potential 15% annualized upside.
• Despite market volatility and declining volumes, Barry Callebaut's revenue is up 63% due to cocoa pricing, ensuring solid earnings growth.
• The company's strategic investments and cost-plus model position it well for future growth, targeting a 1,700 CHF/share valuation.
• Barry Callebaut fulfills key investment criteria: qualitative, safe, well-run, pays a covered dividend, and currently offers a high upside, justifying a "buy" rating.

Dear readers/followers,

I often look at European companies, though Swiss companies have been mostly less represented (with some exceptions). Given easier access to Swiss markets since 2025, this is going to change, and my coverage will, going forward, include more Swiss companies. One company I have been wanting to look at for a long time is the Swiss Cocoa/Chocolate company Barry Callebaut AG ( BRRLY ).

I personally love artisanal chocolate and high-quality chocolate. It's one of the few candies I still eat after having stopped eating more "Normal" candies, such as gummies and the like, some years ago. This company is about 30 years of age from when a French company, Cacao Barry, and Belgian Chocolate producer, Callebaut, merged. Headquartered in Zürich, it is one of the aforementioned Swiss companies, but the company produces its products throughout the entire world. The source companies have over 170 years of age behind them, and this makes the merged company one steeped in tradition....

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