Back to top

Analyst Blog

Zacks Equity Research

International Flavors Hits 52-Week High on Solid Prospects

MTX NL IFF GPRE

Trades from $3

Shares of International Flavors & Fragrances Inc. (IFF - Free Report) reached a new 52-week high of $141.19 during its trading session on Sep 21. This apex improved upon the last 52-week high of $139.81 on Aug 9.

The flavors and fragrances specialist closed its trading session at $141.1 on Sep 21, yielding year-to-date return of roughly 19%. The trading volume for the session was 0.48 million shares. Earnings estimate revisions for 2016 and 2017, along with an expected earnings growth rate of 8.5% for the next five years indicate International Flavors & Fragrances’ potential for further price appreciation.

Growth Drivers

International Flavors & Fragrances’s performance has been impressive in three of the four trailing quarters as reported results surpassed the Zacks Consensus Estimate. Average earnings surprise was a positive 0.70%. Last quarter, the company’s earnings of $1.47 per share exceeded the Zacks Consensus Estimate of $1.41 by 4.26%.

In the quarters ahead, International Flavors & Fragrances anticipates benefiting from new business wins, a diversified product portfolio and growing demand for flavors and fragrance products, especially in the emerging markets. In addition, the company’s research and development wing is constantly endeavoring to develop innovative compounds for meeting the rising demand. The company expects currency-neutral net sales to grow roughly 3.5−4.5%, while adjusted earnings per share will likely increase 6.5−8.5%.

In addition, in Sep 2016, International Flavors & Fragrances announced the signing of an agreement to buy Philadelphia, PA-based David Michael & Company, Incorporated. It is a privately-held flavors company, recognized for its product line in the dairy and beverages industries.

With the addition of David Michael & Company, International Flavors & Fragrances expects to boost its flavors business among customers in the fast-growing middle-markets. Besides complimenting the company’s IFF-Ottens Flavors business, the acquired assets will add incremental revenue of $85 million in 2017.

Estimate Revisions Show Potency

Over the last 60 days, the Zacks Consensus Estimate for International Flavors & Fragrances grew 0.7% to $5.56 for 2016 and 0.7% to $6.01 for 2017. These estimates represent year-over-year growth of 5.9% for 2016 and 8.1% for 2017.

INTL F & F Price and Consensus

 

INTL F & F Price and Consensus | INTL F & F Quote

With a market capitalization of $11.3 billion, International Flavors & Fragrances currently carries a Zacks Rank #3 (Hold). Some stocks worth considering in the chemical industry include Green Plains Inc. (GPRE - Free Report) , NL Industries Inc. (NL - Free Report) and Minerals Technologies Inc. (MTX - Free Report) . While both Green Plains and NL Industries sport a Zacks Rank #1 (Strong Buy), Minerals Technologies carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Confidential from Zacks

Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>


In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

MINERAL TECH (MTX) - free report >>

NL INDS INC (NL) - free report >>

INTL F & F (IFF) - free report >>

GREEN PLAINS (GPRE) - free report >>