Merrill Lynch Bullishness On Treasury May Be Wishful Thinking

Treasury Wine Estates has put the worst behind it with new leadership and “a strategic direction fully supported by the majority of its shareholder base,” according to a Nov. 6 analyst report from Bank of America/Merrill Lynch, which may be peppered with some wishful thinking.

The new report opens with a “buy” rating and a price objective (PO) of A$5.50/US$6.38 (US$=A$1.16 on 11/10/14. All prices from this point forward are in A$)

The stock closed at $4.82 on Nov. 10. Check current share price.

The report is Merrill Lynch’s first since Treasury ended talks Sept. 29 with two private equity takeover groups: TPG Capital and KKR/Rhone Capital.

This report, however, fails to offer the sharp insights seen in previous ML reports. It seems seems over-influenced by relatively vague and overly optimistic management pronouncements that obscure a continuing incoherence in company direction.

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Also In This Article:

The full text of the following sections is available to premium subscribers of Wine Executive News.

• Share Price Higher When Based on Net Asset Value

• Prestige Inventory Release Shifts: Strategy Fails Before It Begins

• Treasury Violates Own Strategy With Grange Discounts

• Failing To Recognize A Discount As a Discount

• Penfolds: A Strategic Branding Decision Needed

• Analyst Report & Reality Show A Treasury Still At Odds With Itself

• Treasury Wine 2014 Annual Report

Previous Original Wine Industry Insight Coverage of Treasury Wine Estates

• Who Owns Treasury Wine Estates? They Do!
• Goldman Sachs Advising Treasury Wine
• Treasury Wine: Faint Praise, Crossed Fingers & Tough Love
• Treasury Wine: Incompetent, Irrational, Disorganized
• Major Asian Investment Analysts High On “Mismanaged” Treasury Wine US
• BofA/Merrill Lynch’s Love Affair With Treasury Wine Australia
• BofA Throws Beringer Under Bus, Urges Treasury To Divest ASAP
• Wine “Shortage” Is Bull: Here’s Why
• The Coup d’Etat At Treasury Wine
• Treasury Wine Is Shopping Beringer & Everybody Wants It
• No Winegrape Shortage: Citi Report Based On Bad, Incomplete Data

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