Barrington Getting Constructive On Primo Water, Upgrades To Outperform

• The share price of Primo Water Corporation (NASDAQ: PRMW) has appreciated 83.76 percent year-to-date, rising almost to its 52-week high on November 9 at $9.40.
• Michael Petusky of Barrington Research has upgraded the rating on the company from Market Perform to Outperform, with a price target of $9.50.
• With the stock having declined from its previous levels, Petusky believes that the risk/reward now "clearly favors investment."

Barrington analyst Michael Petusky expects Primo Water to report its 4Q and full-year results in March, with the full-year revenue at the lower end of the guidance range and the adjusted EBITDA marginally higher than the guidance.

For the fourth quarter, Primo Water is expected to report total revenue of $30.4 million, marginally ahead of the consensus and representing a 2.7 percent increase from the comparable period.

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Looking Ahead

"In terms of its business segments, we expect the water business to contribute $21.0 million and the dispenser business to contribute $9.4 million to total revenue," Petusky mentioned.

The EPS is expected at ($0.00), as compared to ($0.10) for the comparable period and the consensus expectation of $0.02.

Petusky believes that the company's business fundamentals continue to be strong and that "this is the right time to return to a constructive stance on PRMW."

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