PhillipCapital initiates 'buy' on Del Monte as turnaround underway

PhillipCapital’s Vivian Ye, citing an earnings turnaround, has initiated coverage on Del Monte, famous for its range of pineapples and bananas, with a “buy” call and a target price of 60 cents.

In a 27 Oct report, Ye notes that its US subsidiary Del Monte Foods has turned profitable in FY2021, recording a full year profit of US$15.8 million after suffering losses since the acquisition in 2014.

Loss-making factories were closed, low margin products exited, new products were introduced and more distribution channels were established.