SunOpta ( NASDAQ: STKL ) jumped in Monday afternoon trading after Cowen called the food stock a top sector pick.
After taking in an investor meeting, analyst Brian Holland and team walked away more impressed with the overall growth profile and think SunOpta ( STKL ) is a good way for investors to get exposure to the plant-based food space. A new facility in Texas is also noted to be a positive as well with more capacity coming on line.
"We have increased conviction in our near and long term forecasts, owing to SunOpta's ( STKL ) ability to leverage strong secular trends and its own high barriers to entry. Specifically, the company’s agnostic posture and capital execution is affording strong growth sight lines underappreciated by the market," wrote analyst Brian Holland.
The bullish view on SunOpta ( STKL ) is also based on the increasing delta between its prospects and those of other plant-based food players.
STKL is also noted to be seeing resilient demand and increasing market share despite the inflationary backdrop.
"Importantly, SunOpta plant based volume +17% Y/Y in 2Q22 was aided by new business development (new customers, new products for existing customers), underscoring competitive moats—in particular, certainly of supply which management said is customers’ primary concern."
Shares of STKL are already up 38% on a year-to-date basis, but Cowen sees more than 50% upside based on its price target of $15. SunOpta ( STKL ) was showing a 6.19% increase on Monday at 2:55 p.m.
The Seeking Alpha Quant Rating on STKL flipped to Buy from Hold on August 22. That ranks 3rd out of the 56 food and meat stocks with a rating.
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SunOpta rallies after being called a top pick on plant-based food potential