Packaged foods maker Kraft Foods Inc. ( KFT ) on Tuesday saw its "Buy" rating reiterated by analysts at Bank of America.
The firm also backed its $40 price target on KFT, which suggests a nearly 18% upside to the stock's Monday closing price of $34.25.
A Bank of America analyst commented, "KFT announced plans to split itself into two companies: Global Snacks Company (Snack Co.) and North America Grocery Company (Grocery Co). In this report, we conduct a bottom up sales and profit growth analysis for the respective companies. Our bottom up analysis for Snack co. indicates that the combined Kraft and Cadbury portfolio has averaged +8% CAGR at retail - before any benefit from distribution synergies and increases in marketing investment."
Kraft Foods shares were unchanged in premarket trading Tuesday.
The Bottom Line
We have been recommending shares of Kraft Foods ( KFT ) since May 5, 2009, when the stock was trading at $24.26. The company has a 3.39% dividend yield, based on last night's closing stock price of $34.25.
Kraft Foods Inc. ( KFT ) is a "Recommended" dividend stock, holding a Dividend.com DARS™ Rating of 3.5 out of 5 stars.
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