Analysts mixed on Dairy Crest update

14th Jul 2015 11:24

(ShareCast News) - Analysts at Numis and Investec have both moved ratings for Dairy Crest, albeit in different directions.Numis upgraded its rating for Dairy Crest from 'hold' to 'add' after the company said it would meet expectations.The broker also raised its price target for the milk, cheese and butter company from 552p to 665p.Numis analyst Charles Pick said the trends outlined were as expected, but the decline in the spreads market was a steep one.Pick noted Dairy Crest's performance would be influenced by the outcome of the sale of its dairies division, which he expected to complete by the third quarter of this year once Dairy Crest obtained regulatory approval.The analyst said the sale of the loss-making division would radically transform the company.Conversely, Investec said the shares were fairly valued and shifted its rating from 'buy' to 'hold', setting a price target for the stock of 554p.Investec said in a note the result was as expected, but pointed out dairy trading appeared to be a very challenging category."We believe the stock price is now factoring in a successful disposal of [the dairy division], which will leave the group a more focussed branded Food play."Shares in Dairy Crest were down by 0.27% to 564.50p at 10:47 BST on Tuesday.