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Europe Food, HPC 2014 Ests. Cut at JPMorgan, Sector May De-Rate 2014-01-28 08:35:19.451 GMT
By Heather Burke Jan. 28 (Bloomberg) -- European food, household & personal care sector may de-rate as earnings growth slows, JPMorgan says. * Sector valuations at historical highs, earnings growth near a decade low * 2014 ests. cut by ~3%-4% on slowing sales, more cautious outlook on margins, FX; sees flat EPS growth in food, 5% in HPC * Sales have decelerated since last yr; may continue on developed mkt price pressure, low global inflation, emerging mkts slowing; sees LFL growth ~4%-5% for most cos. * 2014 margins may rise 10bps in food, 20bps in HPC * Weak sales probably continued into 4Q, margins may help earnings on savings, lower raw material costs * Top picks Nestle in food, SCA, L’Oreal in HPC * Beiersdorf raised to neutral, sales improvement faster than anticipated * Earlier: L’Oreal Cut on Margin Concern, Henkel Top HPC Pick: Commerzbank
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To contact the reporter on this story: Heather Burke in London at +44-20-7673-2044 or hburke2@bloomberg.net
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