Nestlé EBIT Margin Forecast Trimmed Amid Rising Coffee and Cocoa Costs

Nestlé EBIT Margin: RBC Sticks to CHF93 Target for Nestlé Despite Revised Margin Estimates

With a stable price objective of CHF93.00, RBC Capital kept its Outperform rating on Nestle SA on Wednesday. Rising cocoa and coffee prices had an influence on the company’s short-term margins, according to the firm’s study, but these effects were deemed insignificant for their medium-term projections.

The 2025 expected EBIT margin was revised downward, from 16.5% to 16.1%, according to the RBC Capital analyst. The substantial ongoing increase in the price of coffee and cocoa, which has persisted since the margin prediction was lowered in September, is reflected in this revision.

RBC Capital: Short-Term Challenges Won’t Derail Nestlé’s Growth Potential

RBC Capital considers this to be a small setback, even though commodity prices are putting immediate pressure on the company. The company is confident in Nestle’s future profitability, as seen by its optimistic medium-term outlook and its projected 17.6% EBIT margin for 2027.

Given that the CHF93.00 price target has been reaffirmed, it appears that the company does not anticipate that the present difficulties with commodity prices will have a long-term effect on Nestle’s valuation. The comment from the analyst confirms the opinion that Nestle’s long-term investment thesis is not significantly impacted by the latest margin reduction. Finally, despite short-term challenges from rising input costs, RBC Capital‘s position on Nestle shows faith in the company’s tenacity and growth potential.

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