BUZZ-Unilever "finding levers – to pull out of reach" - Barclays

** Barclays (LSE: BARC.L - news) upgrades Unilever (NYSE: UL - news) to "overweight" from "equal-weight", saying the company was "arguably on the right course" to improving profitability, but there's nothing like a little external pressure to expedite the process

** Shares (Berlin: DI6.BE - news) have risen over 20 pct since Kraft-Heinz announced a bid for co on Feb. 17, though Unilever rejected the bid, shares haven't pulled back from those levels

Performance chart: http://bit.ly/2ne05l2

** "Unilever is amongst the most favourably positioned staples companies, in our view, to benefit from emerging market category development," analyst Alex Smith says

** Smith expects Unilever to extend the reach of its zero-based budgeting (ZBB) -- managers must justify all expenses, from pencils to forklifts -- to its more mature categories/geographies and edge up its margin guidance

** Barclays expects Unilever could raise ZBB-related savings to 2-3 bln euros

** Smith also believes that a Colgate deal talk speculated in the press has strategic merit for Unilever and that the acquisition of Colgate followed by a sale of food assets could just about get there avoiding antitrust issues