Here’s why the Treasury Wine (ASX:TWE) share price is tipped to outperform

Experts forecast some sparkle to come for the ASX wine company.

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Key points

  • The Treasury Wine Estates share price is edging into the green today 
  • A broker predicts this share could outperform and hit $13.78 
  • The company's share price is more than 4% in the red year to date 

A broker is predicting the Treasury Wine Estates Ltd (ASX: TWE) share price could make significant gains in the future.

The wine company’s shares are currently swapping hands at $11.85, a 0.42% gain. In comparison, the S&P/ASX 200 Index (ASX: XJO) is 1.3% higher at the time of writing.

Let’s take a look at why experts recommend this company.

Treasury Wine share price prediction

The team at Citi believes Treasury Wine is a buy with a $13.78 price target. That’s nearly 17% more than the current share price.

Citi says Treasury Wine could outperform its expectations in the second half. Citi said industry data shows sales are also shifting from the retail channel to the on-premise channel.

As my Foolish colleague James noted, this could be a huge positive given this channel offers higher margin.

Experts have also recently named Treasury Wine as one of five ASX shares to ride out the 2022 volatility.

WAM Leaders Ltd (ASX: WLE) portfolio manager John Ayoub named the wine company’s shares as meeting the “safe haven” definition, as my Foolish colleague Tony reported.

Treasury Wine reported a 7.5% drop in net profit and 6.7% decline in EBITS in its H1 FY22 results. The company was impacted by reduced shipments to mainland China.

However, looking to the future, the company revealed it has shifted its focus from a mindset of ‘recovery and restructuring’ to one of ‘growth and innovation’.

Treasury Wine shares have fallen just over 1% in the past month. The Treasury Wine share price dropped nearly 3% on 2 March alone, ex-dividend day for the company.

Eligible shareholders will receive a fully-franked interim dividend of 15 cents per share on 1 April.

Share price snapshot

The Treasury Wine Estates share price has gained around 7% in the past year, although it is down 4.6% year to date.

For perspective, the benchmark ASX index has returned around 9% in the past year.

Treasury Wine has a market capitalisation of about $8.5 billion based on its current share price.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Treasury Wine Estates Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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