Jefferies analyst Robert Dickerson maintained a Hold rating on Lancaster Colony (LANC – Research Report) today and set a price target of $203.00.
Robert Dickerson has given his Hold rating due to a combination of factors that influence Lancaster Colony’s current market position. While the company has exceeded third-quarter expectations, the growth, albeit consistent, was modest, with overall sales increasing by approximately 1.4% year-over-year. The Retail segment showed a slight improvement of 0.3%, and the Foodservice segment witnessed a better increase of 2.6%. This growth in Foodservice volumes is notably higher than what has been observed in other companies, suggesting Lancaster Colony’s unique position in servicing national chains.
Moreover, the company’s operational performance has been buoyed by positive net operating cost savings and volume benefits, which have contributed to margin expansion. The discontinuation of two brands within the Retail sector did not significantly impede the volume growth, which is a positive indication of the company’s portfolio strength. Dickerson’s neutral stance seems to reflect a balanced view of the company’s solid, albeit not exceptional, performance and potential, alongside the broader industry context and operational factors that may temper more aggressive growth expectations.
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Lancaster Colony (LANC) Company Description:
Lancaster Colony Corp. engages in the manufacture and marketing of specialty food products. It operates through Retail and Foodservices segments. The Retail and Foodservices segments focuses in the manufacture and selling of frozen breads; refrigerated dressings and dips; and shelf-stable dressings and croutons under the brand name New York BRAND Bakery, Sister Schubert’s, Marzetti Frozen Pasta, and Flatout. The company was founded in 1961 and is headquartered in Westerville, OH.
