Stifel maintains Buy rating on Valmont Industries stock amid slight dealer sentiment improvement

Published 17/07/2025, 13:26
Stifel maintains Buy rating on Valmont Industries stock amid slight dealer sentiment improvement

Investing.com - Stifel has reiterated its Buy rating and $345.00 price target on Valmont Industries (NYSE:VMI) following a survey of 50 Valley irrigation dealers. According to InvestingPro data, the company maintains strong financial health with a GOOD overall rating and has consistently paid dividends for 47 consecutive years.

The survey revealed a slight improvement in dealer network sentiment compared to the previous quarterly assessment, with dealers now expecting next twelve-month volume to decline 1.6% year-over-year, an improvement from the 2.1% decrease projected in the prior survey. Despite market challenges, Valmont has demonstrated resilience with an 8.1% year-to-date return.

Second-quarter 2025 domestic volume was reported weaker than previously anticipated, showing a 3.7% year-over-year decline compared to the 2.5% year-over-year drop in the previous quarterly survey, while next three-month volume expectations indicate a 2.0% year-over-year decrease.

Pricing showed modest improvement, with dealers reporting a 250 basis point year-over-year increase, up from the 200 basis point year-over-year gain noted in the previous quarterly survey.

Crop prices remain the primary factor affecting dealers’ demand outlook, cited by 64% of dealers (down from 74% previously), with weather conditions, tariffs, and general uncertainty also influencing market expectations. Investors should note that Valmont is scheduled to report earnings in 5 days, with InvestingPro offering additional insights through its comprehensive Pro Research Report, available for over 1,400 US stocks.

In other recent news, Valmont Industries has announced a significant development in its financial arrangements with the securing of an $800 million five-year unsecured revolving credit facility. This new agreement, facilitated by JPMorgan Chase (NYSE:JPM) Bank, includes revised terms such as an extended maturity date to July 2030 and reduced commitment fees. Fitch Ratings has upgraded Valmont’s Long-Term Issuer Default Rating to ’BBB’ from ’BBB-’, citing the company’s conservative financial strategy and improved financial flexibility. The rating agency expects Valmont to benefit from trends in electrification, sustainability, and infrastructure investment, projecting EBITDA margins to exceed 16% by 2027.

Additionally, Valmont has finalized separation agreements with two former executives, John T. Donahue and Diane M. Larkin, as part of a corporate restructuring. Stifel analysts have raised the price target for Valmont shares to $345, maintaining a Buy rating, highlighting the company’s resilience and strategic measures to offset tariff impacts. William Blair has upgraded Valmont’s stock rating to Outperform, following clarifications on the impact of tariffs under the USMCA trade agreement. Valmont’s proactive strategies in managing tariff-related risks have contributed to the analysts’ positive outlooks. These developments reflect Valmont’s ongoing efforts to strengthen its financial position and navigate market challenges effectively.

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