LONDON (ShareCast) - (Sharecast News) - Berenberg has lifted its target price for consumer products group Reckitt Benckiser from 5,555p to 5,647p following the release of the company's third-quarter results last week, but kept a 'hold' rating on the stock.
The broker said the stock is "fairly valued", and highlighted the ongoing baby formula lawsuit facing its Mead Johnson Nutrition business, which continues to be an overhang for the business.

The suit, which related to claims that the company failed to adequately warn about the risk of intestinal disease necrotizing enterocolitis (NEC), could result in a settlement of around £0.7bn, according to Berenberg's calculations.

"Headlines related to trials could both positively and negatively surprise over the next 12 months," the broker said.

Nevertheless, last week's third-quarter results showed organic sales growth of 7.0%, comfortably above the 6.3% expected by the market, with the core operations recording like-for-like growth of 6.7% compared with the 5.3% estimate.

According to Berenberg, Reckitt's emerging market operations "remain the growth engine", with China a key driver of outperformance.

The stock was 0.4% higher at 5,912.15 by 1108 GMT.

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