Morningstar upbeat on Australia's Nufarm despite El Nino headwinds; maintains PT

Nufarm

24/09/2023 21:11

** Analysts at Morningstar stay favourable over Nufarm Ltd's
 NUF.AX  longer-term outlook in spite of current weather
conditions adding uncertainty
    ** Brokerage retains fair-value estimate of A$7.70 for
agricultural chemicals co
    ** Analysts keep underlying fiscal 2023 earnings before
interest, tax, depreciation and amortisation (EBITDA) outlook
unchanged at A$482 mln ($310.31 mln) - representing a 7%
increase on fiscal 2022’s A$451 mln
    ** "Normalization to high agricultural commodity prices and
El Nino are potential drivers, but ongoing earnings growth from
the seeds technology segment could be a key catalyst to share
price appreciation, including via omega-3 canola ramp-up" -
Morningstar
    ** Brokerage believes continued growth in food demand in
industrializing nations should underwrite long-term earnings
growth for NUF
    ** Morningstar says bolstered by alliance with Sumitomo
Chemical, Nufarm should deliver significant growth in its
offshore markets
    ** Stock has fallen 22.5% YTD, as of last close

($1 = 1.5533 Australian dollars)

 (Reporting by Shivangi Lahiri in Bengaluru
)
 ((Shivangi.Lahiri@thomsonreuters.com;))