Unilever PLC (LSE:ULVR)’s trading update contained several pleasant surprises, according to Deutsche Bank, which has tweaked its numbers and stuck with a ‘buy’ recommendation.
“Gross margin surprised to the upside as did volume growth and this before the new management have fully mobilised their action plan,“ said the bank.
“There remains a high skew between the outperformers and underperformers in the [consumer staples] group which could provide some volatility, but we see Unilever progressing towards a steadier compounding performance under the new management's action plan.”
Unilever’s discount of 11% to the Food/HPC sector is too large, said Deutsche Bank, which as retained a 4,600p price target.
Shares today were flat at 3,991p.