Nomad Foods, Carnival, Lowe’s among Mizuho’s top picks for consumer sector

Nomad Foods (NYSE:NOMD), Carnival (NYSE:CCL), Lowe’s (NYSE:LOW) and Wayfair (NYSE:W) are Mizuho Americas’ top picks for the consumer sector.

For Nomad Foods (NOMD), the analysts believe that the Street’s concerns for the company’s competitive position are excessive. Mizuho has a target price of $28 and a rating of Outperform on the stock.

“NOMD’s decision to pass through cost inflation in 2022/2023 resulted in volume pressure and market share loss, but significant reinvestment since Sept. 2023 is already effecting an inflection in retail sales in markets of focus,” the analysts said.

For Carnival (CCL), the analysts said the upside to the estimates comes through the company’s asset sale transformation, benefiting margins and future earnings growth, relative to expectations. Mizuho has a target price of $22 and a rating of Outperform on the stock.

The analysts called Lowe’s (LOW) decisively well-positioned as home improvement demand recovers and unleashes outsized, double-digit earnings expansion in the process.

“The home improvement sector is moving towards the later stages of post-pandemic digestion, with LOW set to favorably lap the more pronounced downshift in DIY spending starting in Q3,” Mizuho said. Mizuho has a target price of $280 and a rating of Outperform on the stock.

Wayfair (W) made it to the list as the analysts believe that the company continues to hold its own in a still challenged home furnishings space and is well-positioned as macro headwinds ease.

Mizuho is also positive on the company as signs are emerged for a return to sustainable positive order growth, further share gains, and some reversing in housing trends, and as the management has engineered an exceptionally sharp turn within the core business. Mizuho has a target price of $72 and a rating of Outperform on the stock.