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Nestlé faces temporary headwinds from cost inflation and weak volume growth, but new management's turnaround plan targets brand monetization and volume recovery. Sustainable growth depends on improving Real Internal Growth, as further price hikes are limited by competition and soft demand; increased marketing spend aims to boost volumes. Nestlé trades at a 25% P/E discount to its five-year average, offering a 4.2%+ dividend yield and limited downside, with meaningful upside if operational metrics recover.
Nestlé's H1 2025 results showed resilient organic growth and margin protection despite FX and cost headwinds, reaffirming full-year guidance. Structural cost-saving initiatives, a strong brand portfolio, and pricing power in coffee/confectionery underpin confidence in meeting 2025 targets. Recent share price decline and derating are exaggerated; Nestlé now trades at a 16.2x P/E and >4% dividend yield, offering compelling value.
Nestlé's half-year results were disappointing, with declining revenue, pressured margins, and organic growth driven solely by price increases, not volume. Structural issues persist, as saturated markets and a lack of meaningful growth avenues limit Nestlé's ability to deliver market-beating returns, even under new leadership. Cost-saving and SKU focus plans lack visible progress; no significant divestitures or margin improvements have materialized, raising doubts about turnaround ambitions.
The company will review underperforming mainstream and value brands in its vitamins, minerals, and supplements unit,
Nestlé S.A. (OTCPK:NSRGY) Q2 2025 Earnings Conference Call July 24, 2025 3:00 AM ET Company Participants Anna Olive Magdelene Manz - Executive VP, CFO & Member of Executive Board David Hancock - Head of Investor Relations Laurent Freixe - CEO, Member of Executive Board & Director Conference Call Participants Callum Elliott - Sanford C.
CEO Laurent Freixe said the company was considering further price rises this year. The KitKat maker said U.S. tariffs risk exacerbating existing commodity price pressures.
Nestle posted better-than-expected first-half organic sales growth on Thursday as the world's biggest packaged food company raised prices to address input cost inflation in coffee and cocoa-related categories.
Shifting consumption habits among young coffee drinkers has Nescafe targeting new product lines. The Nestle-owned brand sees cold coffee as a way of opening up new consumers and consumption opportunities.
Nestle announced on Thursday environmental restoration projects in partnership with reforestation startup re.green and chocolatier Barry Callebaut in Brazil, seeking to plant millions of trees in areas where it sources key ingredients.
Retirees looking for dividend growth stocks at a reasonable price have ample reasons to look outside of America, especially with the S&P 500 skyrocketing to new all-time highs and, with that, a somewhat rich valuation.