By Dhirendra Tripathi – Campbell Soup stock (NYSE:CPB) dipped 1.5% on Wednesday on a downgrade by Piper Sandler owing to rising commodity prices, particularly steel.

The brokerage cut its rating on the stock to neutral from overweight and the price target to $43 from $51.

The new target is just 4% higher from the stock’s current price of $41.38.

Analyst Michael Lavery said broad exposure to rising commodity prices, especially steel, is becoming a significant risk to Campbell’s 2022 outlook.

Campbell typically has annual calendar contracts for steel, and Lavery said they have little visibility where 2022 will land.

According to the analyst, the company historically has had relatively modest price-mix gains in its Americas Simple Meal & Beverages — a 9-year average of +0.5% — so offsetting these costs may be difficult.

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