- Andersons (ANDE +0.3%) is upgraded to Buy from Neutral with a $42 price target, up from $40, at Buckingham Research, which believes the company is in the early stages of improvement as the current cycle in agriculture has bottomed out.
- The firm cites three factors - superior crop quality in the eastern corn belt, improved dynamics in wheat, and stable margins from ethanol - that could drive an attractive free cash flow yield; it estimates $100M in free cash flow for FY 2017, suggesting a 10% yield.
- ANDE is committed to achieving $10M in annual run rate cost savings by 2017, but Buckingham thinks it will beat the measure; on top of the Iowa divestiture, the firm estimates ANDE has the potential to add $0.30 to base EPS.