In a report published Friday, Stifel analyst Paul Massoud initiated coverage on The Andersons ANDE at Hold.
According to the report, while it is believed that ANDE is entering into a favorable operating environment in 2014, much of the upside is already valued in the stock (up 107.9% in 2013 vs. the S&P 500 which was up 29.6%).
“We expect a large crop output from the 2013/2014 U.S. planting season to improve revenue and margins in ANDE's grain handling business,” the report noted. “The USDA estimates U.S. corn production of 14.0 billion bushels, up 29.8% y/y, and soybean production of 3.3 billion bushels, up 7.4% y/y. As a result of the large harvest, we estimate 2014 revenue from ANDE's Grain segment will increase 5.0% y/y to $3.7 billion and EBT margin will improve from 1.6% in 2013 to 3.0% in 2014.”
The report further asserted that ANDE shares currently trade at 9.6x their 2013 EBITDA estimate versus a normalized range of 6.1x-10.2x for Street consensus current year estimates (one standard deviation from the mean of 8.1x).
ANDE closed Thursday at $87.67.
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
date | ticker | name | Price Target | Upside/Downside | Recommendation | Firm |
---|
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in