Citi upgrades Jeronimo Martins stock to Buy on expected Polish food market rebound

Citi upgraded Jeronimo Martins to Buy and raised its price target to EUR24.60 from EUR20.00, citing expectations for a significant rebound in the Polish food market and improved performance across its key regions. The upgrade anticipates mid-double-digit bottom-line growth, driven by stronger like-for-like sales and margins, particularly from its Biedronka chain in Poland, underpinning a 19x P/E valuation on 2026 projected results.

Analysis

Citigroup has upgraded Jeronimo Martins to Buy from Neutral, raising its price target to EUR24.60 from EUR20.00 on the expectation of a significant rebound in the Polish food market. The upgrade is underpinned by a forecast of mid-double-digit bottom-line growth, driven by anticipated improvements across all three of the retailer's key markets—Poland, Portugal, and Colombia. The analysis places particular emphasis on the Biedronka chain in Poland, which is expected to reverse a period of like-for-like sales weakness and margin pressure to deliver stronger sales and more robust margins. Citi's new price target is based on a forward-looking 19x price-to-earnings multiple on the company's projected 2026 results, signaling strong conviction in a multi-year recovery. However, the article includes a counterpoint, noting that an AI model from InvestingPro did not identify the stock as a top-tier undervalued opportunity.

Key Decisions for Investors

• Investors with a bullish view on European consumer staples and the Polish economy could consider this upgrade a key catalyst, as the thesis is heavily reliant on the recovery of the Biedronka chain.
• It is crucial to monitor upcoming earnings reports for tangible evidence of the forecasted stronger like-for-like sales growth and margin expansion to validate Citi's forward-looking assumptions.
• The valuation is based on 2026 projections, introducing significant execution risk; therefore, investors should weigh the potential upside against the possibility that the company may not meet these long-term growth targets.