Q: please comment on Saputo latest earning report. Many analysts see recovery to fiscal 2025. What is your view on the company? buy, hold or sell? Thank you
5i Research Answer:
Revenue for the quarter came in at $4.5 billion, up from $4.0 billion in the same quarter last year and up from street estimates of $4.4 billion. Earnings per share rose to $0.47 from $0.26 a year ago and ahead of forecasts of $0.43. Management cautioned that consumer sentiment has turned negative, which could dampen the outlook for the start of fiscal year 2024. SAP reiterated its FY2025 EBITDA target of $2.125 billion, but speculated an extension on the target timeline citing demand/commodity weakness. Operational efficiency improvements are in pipeline for FY2024. Considering a somewhat murky visibility, it is hard to generate much excitement here with SAP right now. A weak HOLD.