Bank of America reeled in expectations on The Duckhorn Portfolio ( NYSE: NAPA ) after taking in a recent investor conference.
Analyst Peter Gallo and team dropped sales estimates due to some slowing in the broader wine category and a slight deceleration in the luxury wine segment where NAPA’s portfolio exclusively sells. Lower gross margins are also anticipated due to headwinds in FY23, particularly with Kosta Browne-related issues. NAPA is also expected to step up investment spending in marketing in FY23.
BofA lowered the price objective on Buy-rated Duckhorn Portfolio to $18 from $24 to $18 to reflect the lower estimates and a lower target multiple of 16.4X the 2023 adjusted EBITDA estimate.
NAPA is due to issue its earnings report on September 28. See the consensus estimates.
For further details see:
The Duckhorn Portfolio is viewed cautiously by BofA in front of earnings