Campbell Soup Company is up more than 1% in morning trading after scoring an upgrade from sell to neutral at Goldman Sachs. The broker noted that the soup company's current multiple is in line with more realistic growth expectations. However, concerns linger about rising commodity prices and the fundamental outlook for U.S. soup trends. In a note, Goldman said, While a relatively healthy soup category and additional new products may support Campbell through any imminent soft patches, a lack of visibility into both the top line and commodity cost pressure remain key risks and demand a more tempered neutral outlook.
Today's gains could help CPB extend its run atop its 10-day and 20-day moving averages. After slipping below these former support levels early in September, CPB was able to elbow its way back above these short-term trendlines on Tuesday. Support remains in the form of the stock's 20-month moving average, but resistance from its 20-week counterpart looms overhead.
According to Zacks, the soup peddler now has no sell ratings to its name. The stock has 9 buy or better ratings, along with 7 holds. Meanwhile, CPB could be benefiting from a minor short-covering boost at the stock's average daily volume, it would take almost 2 days to fully repurchase the 3.8 million CPB shares shorted.