Piper Jaffray initiated coverage on S&W Seed Company SANW with an Overweight rating and a $14.00 price target.
Piper Jaffray noted, "We view S&W's acquisition of Imperial Valley Seed as a transformative event for the company and believe with significantly expanded alfalfa seed production acreage that sales & margins will show meaningful improvement over the next 2 years. Through market share gains and favorable seed pricing, we are forecasting sales to more than double through CY14 and operating margins to expand by 10 percentage points. Longer-term, SANW is building the foundation for 3 key growth opportunities: (1) GMO alfalfa seed, (2) a doubling of SANW's addressable market by entering the dormant alfalfa seed market, and (3) expansion of SANW's initial work in the sweetener-substitute stevia market."
S&W Seed Company closed at $7.89 on Friday.
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