Barclays maintains Bunge stock with $85 price target

Thursday, Barclays (LON:BARC) analyst Benjamin Theurer reiterated an Equalweight rating and an $85.00 price target on Bunge Limited (NYSE:BG), which currently trades at $75.90 with a P/E ratio of 10. According to InvestingPro analysis, the stock appears undervalued based on its Fair Value estimate. Theurer’s commentary highlighted Bunge’s consistent adjusted earnings per share (EPS) forecast of approximately $7.75 for the fiscal year 2025, despite lowering its Agribusiness guidance. The adjustment is attributed to anticipated softer U.S. processing margins in the second quarter due to open capacity. Despite these challenges, the company maintains a strong financial position with an InvestingPro Financial Health Score of "GOOD" and has consistently maintained dividend payments for 25 consecutive years, currently offering a 3.58% yield. A recovery is expected in the fourth quarter, which should result in a relatively stable year overall.

Theurer noted that the Canadian canola market experienced a tighter crop but is projected to improve with the upcoming harvest in the Southeast later in the year. Similarly, after facing challenges with softseed crops in Europe and competition with soyoil, the European harvest is also expected to show improvement.

Regarding the Renewable Seed Oil (RSO) segment, Theurer mentioned that it is likely to benefit from Bunge’s palm oil business. Despite these potential gains, the RSO segment’s year-over-year forecast remains downward. Theurer’s analysis indicates that while there are certain headwinds in the short term, there are also areas within Bunge’s operations that could see positive developments in the latter part of the year.

Bunge Limited, a global agribusiness and food company, operates in a volatile market where crop yields and commodity prices can significantly impact its financial performance. The company’s ability to navigate these challenges will be crucial for meeting its adjusted EPS targets and maintaining its market position.

Investors and market observers will be watching closely to see how Bunge’s strategies unfold throughout the year and whether the anticipated improvements in crop harvests and the RSO segment will materialize as expected. With a market capitalization of $10.17 billion and annual revenue of $53.11 billion, Bunge remains a significant player in the global agribusiness sector. For deeper insights into Bunge’s financial health and growth prospects, InvestingPro subscribers can access comprehensive analysis and 10+ additional ProTips in the detailed Pro Research Report.

In other recent news, Bunge Limited reported its Q1 2025 earnings, revealing an adjusted earnings per share (EPS) of $1.81, which exceeded the forecasted $1.31. Despite this positive earnings surprise, the company’s revenue of $11.64 billion fell short of the anticipated $13.11 billion, highlighting ongoing market challenges. Additionally, Bunge announced a partnership with Repsol (OTC:REPYY) to advance low-carbon initiatives, a move that aligns with their strategic focus on renewable energy. The company maintained strong cash flow and a low leverage ratio, indicating stable financial health. Bunge also reaffirmed its full-year 2025 adjusted EPS guidance of approximately $7.75, projecting improved crush margins in the fourth quarter. The company continues to await regulatory approvals for its planned combination with Viterra, which it expects to close in the near term. Furthermore, Bunge has terminated its agreement with CJ Selecta, citing regulatory approval delays. Analyst firms have taken note of these developments, with some expressing optimism about Bunge’s strategic initiatives and financial outlook.

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