Citigroup has upgraded its stance in Davide Campari-Milano SpA from 'hold' to 'buy'. Dealers said today (3 January) that Citigroup also increased its price target for the drinks company's shares from EUR6.70 to EUR7.10.

Campari's recent acquisitions, including Glen Grant, should mean additional revenue of more than EUR70m a year. Citigroup added that it expected Campari to achieve its guidance of 5% annual growth.

However, based on Campari's free cash flow forecast for 2005 and a weighted average cost of capital of 7%, Citigroup estimated that the current share price implied a long-term growth rate of just 1%.