Bank of America Merrill Lynch Updates FY11 EPS Estimate on Campbell Soup

Bank of America Merrill Lynch is out with its report today on Campbell Soup CPB, updating its FY11 EPS estimate. In a note to clients, Bank of America Merrill Lynch writes," We raise our FY11 EPS estimate from $2.40 to $2.47. Our FY11 estimates are predicated on sales growth of +0.3% (incl. +1.6% benefit from favorable swing in FX), gross margin contraction of 80bps and EBIT decline of -4.6% (with operating margins down -80bps). The implied 4Q EPS is $0.34. We expect growth (both sales and EPS) to be concentrated in 4Q11 due to easier comparisons and plans to ship new products for FY12. Our F12/F13 EPS estimates of $2.54/$2.65 are unchanged. We maintain our Neutral rating and $35 price objective. Our PO implies 14.1x our CY11 EPS of $2.49, a 13.8% discount to the group." At the time of posting, shares of CPB were trading pre-market at $35.25, up 0.86% from Monday's close.