The last chance saloon as Danone goes all-in

  • Sectors : Foods
  • Companies : Danone

Ratings and price correct at time of issue.

  • Danone

    Closing Price: 5246c

  • RATING 18/06/19

  • PREVIOUS RATING 09/02/17



Danone's ambition to pivot its model to a local and more decentralised structure is not without risk; however, standing still presents an even bigger risk. Despite glimpses of progress in 2018 and 2019, Danone's long-term execution has been marred by inconsistency. This transformation warrants a structural and cultural readjustment - one that is without precedent at Danone. It's an all-in bet, almost binary, with €1bn of gross cost savings targeted by 2023. The equity infers future delivery consistent with its past, which we think is harsh. We lower FY21 EPS by 4.8% and upgrade FY22/FY23 EPS by 7% and 10% respectively.

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Dec 15 2020, 07:00 GMT