Treasury Wine Should Prune, not Quit Its U.S. Portfolio

Dow Jones
08/11

0155 GMT - Treasury Wine Estates should keep hold of a smaller U.S. portfolio rather than completely quit the region, CLSA analysts reckon. Maintaining their outperform rating on the stock, the analysts wonder whether the Australian vinter's U.S. moves point to an exit or a repositioning. They conclude that pruned production and inventory offloading sets up Treasury Wine's troubled U.S. operation for improved profitability should management choose to keep hold of it. They tell clients that the U.S. business, which remains subject to a strategic review, is now valued at about 2.3 billion Australian dollars. CLSA holds its target price at A$6.50. Shares are down 0.8% at A$5.615.

 

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