My Favourite Value Stock: AGCO Corporation
Thomas Clark • 28 Comments
Thomas Clark • 28 Comments
Thu, Aug. 4, 8:13 AM
- Adjusted net income of $83.6M, or $1.02 per diluted share vs. $110M, or $1.25 in the same quarter a year ago.
- Sales by region: North America -10.2%; EMEA +4.6%; South America -14.3%; Asia/Pacific -25.9%.
- "Weak global demand for agricultural equipment is expected to negatively impact AGCO’s sales and earnings in 2016," the company said in a statement, maintaining its full-year EPS guidance of $2.30 on net sales of $7B.
- Q2 results
Thu, Aug. 4, 8:04 AM
Wed, Aug. 3, 5:30 PM
- AAC, AAON, ACRE, ACTA, AGCO, AGIO, AKRX, ALSK, AMCX, AME, AMRN, ANIP, ANSS, APA, APLP, ARRY, AYR, BBW, BCE, BCRX, BDX, BLL, CBB, CCOI, CHD, CHK, CNNX, CNSL, COT, CPK, CRIS, CRZO, CTB, DNR, DUK, DW, ELOS, EPAM, ESNT, EVA, FMSA, GLDD, GLOG, GOGO, GTN, HAR, HGG, HII, HL, HMHC, HRC, HSC, HSIC, HSNI, ICPT, IMGN, IOC, IPCC, IRM, IT, ITCI, ITT, K, KOP, LBY, LFUS, LGND, LIOX, LPX, LQDT, LXRX, MFC, MGM, MGP, MITL, MMS, MNTA, MPEL, MPG, MPW, NAO, NERV, NGS, NOK, NSAM, NXTM, OGE, OMAM, OMF, ORBC, PBH, PCRX, PGNX, PGTI, PH, PLUG, PPP, PRFT, PRIM, PRTY, PWR, QSR, RDUS, REGN, RFP, RGEN, RLGY, ROLL, RVLT, RWLK, SBH, SEAS, SFM, SGM, SHLX, SNR, SPAR, SPH, SRE, SSTK, SSYS, STFC, STOR, STWD, TDY, TEVA, THS, TICC, TIME, TK, TNK, TOO, TSEM, TVPT, TWI, UAM, UNT, USAC, USCR, VIAB, VLP, VWR, WIN, WPC, WRK, XLRN
Tue, Jul. 26, 8:43 AM
Mon, Jul. 25, 2:58 PM
- Deere (DE -2.8%) is downgraded to Underweight from Neutral with a $67 price target, cut from $76, at Piper Jaffray, which believes the current agricultural downturn will persist into 2017 for a fourth consecutive year.
- After speaking with growers, agronomists and dealers, Piper analyst Brett Wong says growing conditions have been extremely favorable and he foresees further pressure on corn prices after another strong year of U.S. corn yields, and grain prices also will remain weak, resulting in further declines in farm machinery demand.
- Farm machinery OEM stocks continue to trade at elevated multiples, expecting that this year will be trough demand with a recovery next year; Piper believes that overall global farm machinery demand will be down next year, which does not support current expectations for the stocks, and that estimates and valuation multiples are at risk.
- The firm also downgrades AGCO (AGCO -3%) and CNH Industrial (CNHI -2.6%) to Underweight from Neutral with respective $37 and $5 price targets.
Wed, Jun. 29, 8:55 AM
- AGCO agrees to acquire Danish seed and grain handler Cimbria Holdings from Silverfleet Capital for ~$340M.
- Cimbria sales, which are expected to reach $240M in FY 2016, are concentrated in western Europe with growing exposure to eastern Europe, Africa and the Middle East.
- AGCO says Cimbria’s products complement its GSI offerings and provides an opportunity to grow its business and expand its margins.
Mon, Jun. 27, 3:19 PM
- AGCO (AGCO -5.9%) is downgraded to Underweight from Neutral with a $44 price target, cut from $47, at J.P. Morgan, citing weakening fundamentals in European agriculture and the rising dollar, which is expected to weigh on the company's North American business.
- JPM says AGCO has the greatest exposure to Europe in its machinery coverage, and notes that 60% of the company's EBIT comes from Europe, Africa and the Middle East, with another 16% from South America, where political and economic instability in Brazil continue to weigh on equipment demand.
- The firm also downgrades PACCAR (PCAR -6%) to Underweight from Neutral with a $47 price targets, lowered from $58, as the company's key end markets, especially the U.K., are likely to come under pressure in the near term, and North American truck fundamentals are expected to remain weak, with further production cuts expects in H2.
Fri, Jun. 3, 12:19 PM
- Deere (DE +1.6%) moves higher after Goldman Sachs upgrades shares to Buy from Neutral with a $105 price target, raised from $87, as the firm sees significant upside to the mid-cycle as crop inventories tighten.
- Analyst Jerry Revich says he now prefers the ag machinery group to truck and construction machinery, given that high horsepower farm equipment is at a 30-plus year trough and improving U.S. row crop commodity demand could outstrip supply in 2017-18 due to rising feed and export demand for the first time in the soft commodity inventory cycle.
- The firm raises DE's mid-cycle EPS estimate to $7.50 from $6.25, “driven by higher operating leverage due to R&D and overhead leverage.”
- Today's upgrade is the latest of a flurry of analyst love for DE in recent days (I, II).
- Other farm equipment stocks also are higher, including CNHI +4.5%, AGCO +1.7%, LNN +1.2%.
Thu, Apr. 28, 3:52 PM
Wed, Apr. 27, 8:10 AM
Tue, Apr. 26, 5:30 PM
- ACCO, AGCO, ANTM, AOS, AVY, BA, BEN, BGCP, BHI, BOKF, BSX, CFR, CMCSA, CSL, DHX, DPS, DX, EVER, EVR, FDML, FI, GCI, GD, GIB, GPI, GRA, GRMN, GT, HES, HLT, IART, IP, JLL, LDOS, LEA, LLL, LRN, MDLZ, MKTX, MVIS, NAP, NDAQ, NEO, NMR, NOC, NS, OC, OSIS, PB, RDN, RES, ROK, ROL, SAIA, SC, SIX, SLAB, SLGN, SMED, SO, SONS, STM, STNG, STT, SUP, SXC, TGNA, TKR, TPH, UMC, UTX, VLY, WEX, WOOF
Tue, Apr. 19, 5:39 PM
Tue, Apr. 19, 2:49 PM
- Cliff Robbins of "friendly activist" hedge fund Blue Harbor tells CNBC his stake in AGCO Corporation (AGCO +3.4%) is up to 8%. It's an oligopoly-type business, and underlevered, he says, and can lift EPS up to $5-$6.
- Now read: AGCO Corp.: Cyclical Downturn In Farm Incomes Creates A Buying Opportunity
Wed, Apr. 13, 2:24 PM
- Investors should take profits on machinery stocks ahead of earnings, J.P. Morgan analysts say, as valuations are stretched after the sector outperformed the S&P in Q1 +17% vs. +1.3%, and investors likely will have little tolerance for weaker than expected performance.
- The firm suggests avoiding Deere (DE +1.9%), Agco (AGCO +3.5%) and CNH Industrial (CNHI +3%) on weaker fundamentals with downside risk to the market outlooks for each region, and Paccar (PCAR +2.9%) on weaker NAFTA HD truck demand vs. its guide for a 12% decline in U.S. and Canada retail sales.
- However, JPM likes Allison Transmission (ALSN +2.4%) heading into Q1 as it has underperformed peers while its exposure to HD Class 8 long haul is limited and MD orders are up 5% YTD.
- Rated Neutral CAT, MTW, JOY, NAV, TEX, MCRN, PH, KMT, ETN, ITW.
Wed, Mar. 30, 9:53 AM
- BMO Capital has raised its price target on (AGCO +0.3%) to $49 from $43, while maintaining its Market Perform rating.
- "We continue to be impressed with how well AGCO management has executed during the downturn, with a strong focus on driving permanent cost savings and operating efficiencies."
- "We remain convinced that peak EPS power in the next cycle should well exceed the prior high of $6 (in 2013), though we want to remain patient until further signs of a bottom emerge before becoming more constructive with the shares."
Wed, Mar. 2, 6:37 PM
- Machinery stocks such as Terex (NYSE:TEX), Caterpillar (NYSE:CAT), Deere (NYSE:DE), Cummins (NYSE:CMI), Joy Global (NYSE:JOY) and Manitowoc (NYSE:MTW) may have come too far too fast, J.P. Morgan analyst Ann Duignan asserts.
- Duignan notes that at year-end 2015, the firm's machinery coverage was trading at a P/E multiple of ~14x estimated 2016 earnings, but at March 1, the group was trading at 16.3x; in terms of total shareholder returns, the group was up 5.5%, outperforming the S&P 500's YTD 2.8% loss.
- Within construction stocks, TEX (+25.9%), CMI (+15.1%), MTW (+5.3%) and CAT (+3.0%) have outperformed while Oshkosh (NYSE:OSK) (-9.2%) has underperformed; in agriculture machinery, Agco (NYSE:AGCO) (+11.1%), Deere (+6.3%) and CNH Industrial (NYSE:CNHI) (-2.2%) have outperformed, while JOY (+5.9%) has outperformed in the mining equipment group.
AGCO Corp. engages in global manufacturing and distribution of agricultural equipment and related replacement parts. It designs, manufactures and distributes grain storage, handling equipment and protein production systems. The company also provides retail financing through its retail finance... More
Sector: Industrial Goods
Industry: Farm & Construction Machinery
Country: United States