RBC Capital initiated Utz Brands (NYSE:UTZ) with an Outperform rating and a $17 per share price target in a note Tuesday.
Analysts told investors in a note that "the bull case is like a variety pack – lots of options."
They acknowledged that the salty snacks category has recently come under pressure — mainly from macro factors — which they expect to continue for the next few quarters. "That said, when taking a 12-18 month view, we believe there is a compelling buy case for UTZ," analysts added.
They noted the company is "getting pure-play exposure to one of the more attractive categories across consumer staples," while they see "upside from share gains as the company expands geographically."
The analysts also pointed to UTZ's convergence of margins relative to peers, and a potential take-out scenario.