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International Flavors & Fragrances Touches a New 52-Week High - Analyst Blog

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Shares of International Flavors & Fragrances Inc. ( IFF ) scaled a new 52-week high of $101.73 during its trading session on Jun 9. The new 52-week high improved upon the last one of $100.93 hit on May 8.

International Flavors & Fragrances closed the session at $101.73, reflecting a solid year-to-date return of 27.3%. The trading volume for the session was 3.2 million shares. Positive revision in the 2014 earnings estimate as well as an expected earnings growth rate of 8.7% for the next five years indicates further upward potential for this flavors and fragrances manufacturer.

Growth Drivers

Share price of International Flavors & Fragrances has climbed 3.7% since the company reported first-quarter 2014 results on May 6. Adjusted earnings grew 11% year over year to $1.32 per share, surpassing the Zacks Consensus Estimate of $1.25 by 5.6%.

Revenues increased 6% or 7% on a constant currency basis. The top-line growth was driven by solid performance in the emerging markets. The acquisition of Aromor added 1% to sales growth. Margins benefited from cost reduction and manufacturing efficiencies.

For 2014, management anticipates revenues and earnings per share to grow in the double-digit range. Aromor is expected to add 1% to local currency sales growth and be accretive to earnings.

The stellar quarter performance and a robust outlook coupled with a positive average earnings surprise of 1.7% have made us optimistic about International Flavors & Fragrances' performance in the coming quarters. The company has an Earnings ESP of +0.79% for 2014 and +1.64% for 2015.

Estimate Revisions Show Potency

Over the last 60 days, the Zacks Consensus Estimate for International Flavors & Fragrances has increased by 1.6% to $4.96 for 2014 and by 1.3% to $5.50 for 2015. The Zacks Consensus Estimate also depicts year-over-year growth rates of 13.1% for 2014 and 9.1% for 2015.

International Flavors & Fragrances has a market capitalization of $5.2 billion and carries a Zacks Rank #2 (Buy). Other stocks worth considering in the industry include NL Industries Inc. ( NL ), Sensient Technologies Corporation ( SXT ) and Novozymes A/S ( NVZMY ). All these stocks carry the same Zacks Rank as International Flavors & Fragrances.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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