Bunge stock maintains Buy rating at UBS following Viterra merger

Published 03/07/2025, 15:18
Bunge stock maintains Buy rating at UBS following Viterra merger

Investing.com - UBS has reiterated its Buy rating and $100.00 price target on Bunge (NYSE:BG) following the confirmation of its merger with Viterra. Currently trading at $78.95, InvestingPro analysis suggests the stock is undervalued, with a P/E ratio of just 10.29.

Glencore (OTC:GLNCY) has officially confirmed the merger between Viterra and Bunge, a transaction designed to connect farmers in major production regions to areas experiencing growing consumption demands.

The combined entity will be led by Bunge’s current leadership, with Greg Heckman continuing as CEO and John Neppl as CFO, while Viterra’s CEO David Mattiske and Bunge’s Co-President of Agribusiness Julio Garros will serve as COOs.

Under the terms of the merger agreement, Glencore received approximately 32.8 million shares in Bunge, representing about 16% ownership in the enlarged company, along with approximately $900 million in cash.

UBS analyst Manav Gupta noted that the merger is expected to allow for better balance of value chains across geographies and enhance significant synergies while producing more stable cash flows. With a strong current ratio of 2.04 and a 25-year history of consistent dividend payments, Bunge demonstrates solid financial health. For deeper insights into Bunge’s financials and exclusive analysis, check out the comprehensive research available on InvestingPro.

In other recent news, Bunge Limited reported its Q1 2025 earnings, showcasing an adjusted EPS of $1.81, which exceeded the forecast of $1.31. However, the company’s revenue of $11.64 billion fell short of the anticipated $13.11 billion, indicating ongoing market challenges. The company’s merger with Viterra Limited has been completed, forming a significant global agribusiness entity, with expectations of network synergies and enhanced cash flows. S&P Global Ratings upgraded Bunge to ’A-’ following this merger, citing improved business risk profile and diversification benefits. Additionally, Chinese antitrust authorities approved Bunge’s $8.2 billion acquisition of Viterra, clearing a major regulatory hurdle. Barclays (LON:BARC) maintained its Equalweight rating on Bunge with an $85 price target, noting a consistent adjusted EPS forecast for the fiscal year 2025. The company also announced a partnership with Repsol (OTC:REPYY) for low-carbon initiatives, indicating strategic moves in renewable energy sectors. These developments reflect Bunge’s ongoing strategies and market positioning amid a volatile agribusiness landscape.

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