Unilever's (UL) share price already appears to reflect concerns around the planned separation of its food business, while expectations for future growth remain modest and recent incentive-plan changes suggest lower internal confidence in meeting public targets, RBC Capital Market said Tuesday in a report.

The planned transaction may add complexity for shareholders, offer limited value, and risk distracting management, with the streamlined company likely to hold about the same competitive position even after focusing on faster-growing categories, the report said.

Unilever's new pay structure allows bonuses to be earned at growth rates below the company's stated ambitions, raising questions about the credibility of those goals, the report said.

Market expectations already reflect caution, with consensus forecasts near the low end of guidance and RBC's own estimates sitting below that range, the report said.

RBC said these concerns now appear largely reflected in the stock, and the shares were upgraded to sector perform from underperform with a price target of 42 British pounds ($56.75).

Price: 57.33, Change: -0.63, Percent Change: -1.10