Nestlé shares: buy, hold or sell?

In a recent Money Magazine feature, our Co-CIO, Chad Padowitz, shares his insights on Nestlé, the Swiss multinational food and drink conglomerate. He highlights Nestlé’s consistent organic sales growth, impressive return on invested capital (ROIC), and strategic portfolio management as key factors that make the company an attractive prospect for investors, despite recent challenges.

Pointing to the management team’s commitment to achieving ambitious targets for 2025, including EBIT margins of 17.5% to 18.5% and mid-single digit annual organic growth, Chad makes the case that if Nestlé delivers on its targets, investors could potentially see shares reaching ₣120 by FY26, representing a 28% upside from current levels.

He also adds, “Nestle is on a significant and important journey to improving its ESG performance and has already made decent inroads.” The company has set a net zero target by 2050, driven by renewable energy sources and low-carbon alternatives in its logistics. It also has action plans to address human rights challenges within it’s supply chain. This commitment to sustainable practices and ethical sourcing enhances Nestlé’s appeal to ESG-focused investors.