Mondelez's (MDLZ) Q2 earnings are expected to be a "positive catalyst" for the stock as the company is benefiting from "moderating cocoa costs," Morgan Stanley said in a Monday note.

The food company is expected to report Q2 results above expectations and maintain its 2025 earnings per share guidance, the analysts said. Q2 organic sales are expected to grow 6.4% year-over-year as the company reaps from "accelerating pricing in its chocolate business," and a shift of the Easter holiday.

Morgan Stanley analysts also said Vital Farms is expected to increase its 2025 outlook to "partially flow-through" H1 performance. Vital Farms' management may also set aside some cushion amid current macroeconomic uncertainty, according to the note.

Morgan Stanley raised Mondelez's price target to $73 from $72 while maintaining an overweight rating on the stock, while Vital Farms was reiterated at overweight with price target increased to $41 from $39.

Mondelez and Vital Farms shares were up 1.6% and 1.8%, respectively, in recent trading.

Price: 70.50, Change: +1.08, Percent Change: +1.56