Bank of America analyst Matthew DeYoe upgraded International Flavors and Fragrances ( NYSE: IFF ) on Friday based upon the upside offered by management changes.
He explained that a new settlement with Carl Icahn and shifts to focus on free cash flow by new management could offer some upside. While DeYoe held a Sell-equivalent rating into the company’s earnings report on Wednesday, the over 20% post-earnings plunge has baked in much of the downside case. As such, he upgraded the stock to Neutral.
“The new management has kicked off its initiatives to fix underperforming, underinvested, and historically mismanaged businesses. We suspect there is a lot of opportunity here, but much of the benefits appear to accrue in the medium-term, leaving growth muted in 2023,” he told clients. “However, with shares off considerably given the poor earnings and cash flow outlook, we see valuation as more balanced and rate shares Neutral accordingly.”
DeYoe assigned the stock a $106 price target. Shares of the New York-based consumer products company rose 2.13% on Friday.
Read the company’s earnings call transcript .
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International Flavors & Fragrances upgraded at Bank of America