TreeHouse Foods rallies as UBS starts at "buy"

Hostess Brands

20/03/2023 15:12

** TreeHouse Foods Inc's  THS.N  shares up 6.5% at $48.60 as
UBS initiates coverage of package food maker at "buy"
    ** THS on course for biggest one-day pct gain since last May
    ** UBS sets PT at $60, implying ~31% upside to stock's Fri
close
    ** TreeHouse in early innings of a beat and raise cycle as
it stands to benefit from several strategic initiatives and
secular tailwinds, UBS analyst Cody Ross says in note
    ** Ross points to co's investments to improve service
levels, sale of significant portion of its meal prep business to
reduce complexity, advantaged scale to become low-cost leader,
private label volume share gains, and increasing retailer focus
on private label
    ** Separately, Ross highlights Twinkies maker Hostess Brands
Inc's  TWNK.O  "dominant" share position of 20% vs 14% for
closest sweet baked goods competitor, but starts coverage at
"neutral" saying growth momentum already priced into its shares
    ** For THS, 4 of 7 analysts rate stock "buy" or "strong
buy", rest "hold"; median PT is $54.50 - Refinitiv
    ** With move on Mon, shares off 1.6% YTD vs S&P 1500 Food
Products index's  .SPCOMFDPR  4.6% decline

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))