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UPDATE: Piper Jaffray Reduces PT to $92 on Monsanto on Pipeline Valuation

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Piper Jaffray reiterates its Overweight rating on Monsanto (NYSE: MON) but reduces its price target on shares from $97 to $92 on compassed valuation multiples.

Piper Jaffray comments, "As valuation multiples have compressed in the agriculture sector (as well as large cap biotech – a commonly used peer group for MON shares), scrutiny around the sustainability of MON's premium multiple has intensified. In this note, we revisit our Overweight thesis on MON shares and outline how Monsanto is positioned to deliver at least mid-teens annual earnings growth over the next 3 years, which should be supportive of sustained P/E valuations. Latin America will continue to be a key profit growth driver over the next 2 years - a factor that we believe investors under-estimate. Following a review of Monsanto's R&D pipeline, we provide a framework to value this pipeline – which we believe is worth approximately $13 per share."

MON closed at $71.30 on Tuesday.

Latest Ratings for MON

DateFirmActionFromTo
May 2015Wells FargoDowngradesOutperformMarket Perform
May 2015BB&T CapitalInitiates Coverage onHold
Mar 2015UBSMaintainsBuy

View More Analyst Ratings for MON
View the Latest Analyst Ratings

Posted-In: Piper JaffrayAnalyst Color Price Target Reiteration Pre-Market Outlook Analyst Ratings

 

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