Barclays sees Nestle's 2025 as transitional, cuts to 'equal weight'
** Barclays cuts Nestle NESN.S to "equal weight" from "overweight," seeing 2025 as a transitional year and a recovery unlikely until 2026
** It says the company needs to get back to the basics, "which means flawless execution and much bigger and bolder innovation"
** The brokerage estimates that two-thirds of the company's revenue weakness stems from "category challenges and the weakness of the consumer," while one-third from market share issues
** Barclays says that there has been a mismatch between internal and external expectations, which pushed the organisation under stress to deliver and was probably the root cause of short-term decisions
** "With new CEO Laurent Freixe in place, we think this short-term mindset will be replaced by longer-term thinking even if it comes with short-term penalties," it says
** Despite some investors and analysts might expect changes to the company's portfolio, the brokerage sees this as unlikely
** It adds it continues to prefer Danone DANO.PA and Unilever ULVR.L
Reporting by Paolo Laudani
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