International Flavors & Fragrances Inc. (IFF) Insiders Knew Better, But Did Investors Listen?

International Flavors & Fragrances Inc. (NYSE:IFF) is now being followed by Seaport Global Securities, as they initiated the stock at Neutral on February 21. Analysts at Citigroup, started covering the stock on November 16 with a Neutral rating. The stock lost favor of Raymond James analysts who expressed their lack of confidence in it using a downgrade from Mkt Perform to Underperform on November 16. Deutsche Bank analysts came out with bullish views on October 16 when the call was made. They think the stock is now Buy compared to to their prior call for Hold.

IFF stock dropped -0.38% in recent trade and currently has a stock-market value of $13.85B. The shares finished at $124.96, after trading as low as $124 earlier in the session. It hit an intraday high Thursday at $125.54. Trading activity significantly weakened as the volume at ready counter decreased to 1,076,011 shares versus 1,280,580 in average daily trading volume over the past 20 days. So far this year, the volume has averaged about 880,428 shares. The stock is now 2.33% above against its bear-market low of $122.11 on May 31, 2018. It has retreated -20.49% since it’s 52-week high of $150.57 reached in November. Now the market price is down -11.56% on the year and down -6.93% YTD.

Wall Street’s most bullish International Flavors & Fragrances Inc. (NYSE:IFF) analysts are predicting the share price to blow past $168 per share during the next 12 months. The current median share price forecast by them is $139, suggesting that the stock could increase 11.24% in that time frame. The average price target of $142.23 calls for a nearly 13.82% increase in the stock price.

International Flavors & Fragrances Inc. (IFF)’s 50 day simple moving average (SMA 50) price is $134.13 and its 200-day simple moving average (SMA 200) price is $133.5. The company’s stock currently has a total float of 106.46M shares. Its weekly volatility is hovering around 1.36% and felt 2.02% volatility in price over a month. On the upside, the share price will test short term resistance at around $125.67. On a downside, the stock is likely to find some support, which begins at $124.13. The failure to get near-term support could push it to $123.29.

When looking at valuations, International Flavors & Fragrances Inc. (IFF) has a pricey P/E of 27.94x as compared to industry average of 22.39x. Moreover, it trades for 17.59 times the next 12 months of expected earnings. Also, it is trading at rather expensive levels at just over 2.3x price/book and 3.48x price/sales. Compared to others, International Flavors & Fragrances Inc. is in a different league with regards to profitability, having net margins of 8.6%. To put some perspective around this, the industry’s average net margin is 8.82%. IFF’s ROE is 10%, which is also considerably worse than the industry’s ROE of 15.33%. It’s also very liquid in the near term, with a current ratio of 2.6. The stock has a debt/capital of 0.75.

Shares of IFF have dropped -13.6% since the company’s most recent earnings report. Over the past 12 fiscal quarters, International Flavors & Fragrances Inc. (NYSE:IFF) has topped consensus earnings estimates in 8 quarters (66%), missed earnings in 3 quarters (25%), whereas at 1 occasion EPS met analyst expectations. IFF last reported earnings that exceeded expectations. The company raked in $1.32 per share, -31.61% change on the same period last year. That was better than consensus for $1.29. Revenue for the recent quarter stood at $1.22 billion, up 43% on last year and below the $1.24 billion predicted by analysts. For this quarter, Wall Street analysts forecast revenue in a range of $1.27 billion to $1.33 billion, which should be compared with $942.81 million generated last year. EPS is seen in a range of $1.51 to $1.65, against the $1.68 reported a year ago.