Unilever PLC (LON:ULVR) is “getting its mojo back” and is well placed to appeal to cash strapped customers looking for affordable products, according to analysts at Barclays, who upgraded the stock to ‘overweight’ from ‘equal weight’.
In a note on Friday, the bank said the consumer goods giant has “one of the most competitive value portfolios” and that they now saw evidence of “better corporate agility, improved execution and, crucially, meaningful share improvement”.
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“Unilever was winning share in only 40% of its portfolio in 2019 but this has stepped up to 50%”, Barclays said, adding that the company had also “turned the corner in hotspots such as US/China haircare and US dressings”.
The bank also upped its price target for the firm to 5,470p from 4,370p, saying plans for Unilever to consolidate to a single LSE listing will provide it with “more options”.
“In our view, unification increases the probability of a demerger of Foods or a large acquisition. CEO Alan Jope was quoted saying that whilst there are no big deals on the imminent radar, there could be later”, Barclays said.
“Unilever is still sitting on a material discount to its Food and HPC peers following a sharp de-rating in the last 12-24 months… We think there could now be a period of catch up”, the bank added.
Shares in Unilever rose 0.6% to 4,698p in late-morning trading.