Goldman Sachs Upgrades Mead Johnson to “Conviction Buy” (MJN)

Children’s nutrition and food maker Mead Johnson Nutrition Co. (MJN) was upgraded by Goldman Sachs analysts on Monday, as the company is expected to build momentum in 2013 and raise earnings estimates.

The analysts upgraded MJN from “Neutral” to “Conviction Buy.” The firm also boosted its price target for the children’s nutrition company from $75 to $95, which suggests a +27% upside to Friday’s closing price of $75.05.

A Goldman Sachs analyst commented, “Despite MJN’s recent set-back in China, which was followed by below-consensus guidance, we believe it uniquely positioned to deliver best-in-class growth and returns. As we detail within, we believe milk formula sales will expand by $46 bn to 2020 globally (11% CAGR) and expect MJN to capture its fair share.”

The analysts also raised MJN EPS estimates. The company is now expected to earn $3.42 per share in 2013, $4.00 in 2014, and $4.74 in 2015.

Mead Johnson shares were flat during pre-market trading on Monday. The stock is down -0.24% over the past year.

The Bottom Line
Shares of Mead Johnson (MJN) have a dividend yield of 1.60% based on Friday’s closing price of $75.05.

Mead Johnson Nutrition Co. (MJN) is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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