Bernstein upgrades General Mills and Campbell Soup

Bernstein has upgraded General Mills (GIS) and Campbell Soup Company (CPB) from Underperform to Market Perform, citing volume improvements for both stocks.

Yahoo Finance Anchors Josh Lipton and Julie Hyman break down the latest developments for both companies and what it means for the stocks moving forward.

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This post was written by Nicholas Jacobino

Video Transcript

Campbell's Soup and General Mills getting upgrades today or from Bernstein.

They go from underperform to market perform.

So why the move Julie to a whole?

Not bullish, but I guess less pessimistic.

Uh, well, the analysts talk about volume improvements in the back half of the year.

Also does highlight Notify valuation, as recent stock under performance has led to 20 plus year low valuations for both companies.

In other words, they look cheap.

Her target on General Mills is 70 for Campbell's Soup 46.

Yeah, and you know she talks about this inflexion in the latter half of the year in volume growth, specifically because we've been having this whole debate over the past year about volume versus price.

Many of these consumer Staples companies had seen increases in overall sales because of price increases, not because they're moving more product out the door.

And there's been a lot of waiting on the part of analysts and ambassadors for that to happen.

So it's interesting.

Alexia Howard here says that that is indeed uh, gonna start to happen.

She says We're gonna lap price declines in single ingredient food categories, more associated with cooking from scratch.

She says that all of that will lead to an improvement in stock performance in the second half, so more positive, not enough to go full bullish, but at least moving to the sidelines, not an under perform anymore.