Danone Upgraded by Morgan Stanley Amid Operational Turnaround
Danone has received a ratings upgrade from Morgan Stanley, which shifted its stance from “Equal Weight” to “Overweight” and raised its price target from €61 to €70. The move signals growing confidence in the French multinational’s ability to deliver profitable growth through renewed strategic focus and operational improvements.
According to Morgan Stanley analysts, Danone is entering a new growth phase driven by improved brand execution, streamlined operations, and a clearer portfolio strategy. They noted that 2024 marks a turning point, with forecasted 6.6% organic sales growth—up from 4.1% in 2023—placing Danone ahead of several peers in the sector.
This momentum follows the company’s reset under CEO Antoine de Saint-Affrique, who launched a strategic revamp dubbed “Renew Danone.” Since the plan’s rollout in 2022, Danone has divested non-core assets, enhanced innovation pipelines, and increased marketing investment behind its key brands, including Activia, Alpro, and Evian. The company has also doubled down on margin expansion, aiming to lift recurring operating margins above pre-pandemic levels.
Analysts highlighted several growth levers, including traction in plant-based dairy alternatives, the rebound in China’s infant nutrition segment, and improvements in the European beverages category. Operational discipline and better pricing architecture are also contributing to the stronger performance outlook.
Danone’s multiyear “Renew Danone” strategy appears to be resonating with investors and analysts alike. The firm not only outperformed internal expectations in recent quarters but has also narrowed its valuation gap with global FMCG peers. Morgan Stanley now sees upside potential in both earnings momentum and multiple re-rating as execution continues to improve.
For FMCG professionals, Danone’s transformation underscores the value of portfolio clarity, disciplined resource allocation, and innovation tailored to evolving consumer trends—particularly in health, wellness, and sustainability. The upgrade reflects broader market recognition of these strategic shifts and signals renewed competitiveness in key global categories.