Analysts Cast Wary Eye on Key Iowa Stocks

BY STEVE DINNEN

Virtually all of the major companies cited today have hold recommendations on them from securities analysts. So if you own one, it’s OK to keep it. But if you don’t own it, maybe don’t buy it. Seeing a price target of $58 for Principal (current price, $54.05) CFRA analyst Cathy Seifert wrote that the company faces a “near-term margin compression”—lower profits, in other words—in its international unit that previously had been a source of growth. Seifert did tip her hat to Principal and its increased focus on fee-based, less capital-intensive asset gathering businesses.

Analysts rarely issue sell recommendations, but that’s the advice on Casey’s from another CFRA analyst, Arun Sundaram. Trading at $163.18 per share already puts Casey’s at the high end of its historical range, he wrote, and Casey’s faces headwinds by way of increased regulatory oversight over vaping and tobacco products (nearly 11% of revenues). It faces higher cheese costs, and increased operating expenses due to its second distribution facility in Indiana. Plus, people are driving less, and getting better mileage.

Interestingly, for beaten down shares of Meredith, there are not only four hold recommendations but four buys. The consensus price target is $30.50; it currently costs $31.97. Maybe these buyers are remembering 2008 and 2009, when Meredith stock plummeted 69% the first year, then skyrocketed 80% the next.

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