Nufarm is spending the day in a trading halt after they announced a capital raising this morning. The announcement is light on detail at the moment, but they are expected to raise $300mil in order to fix balance sheet issues which has seen debt blow out to over $1.3b. Nufarm is also due to present their FY18 results this week bringing to end what has been a difficult few months for the crop protection company which downgraded guidance back in July and has fallen over 30% from highs back in May. It makes it a difficult time to raise capital, and will likely have to be completed at a deep discount to the $6.70 last traded price, although the rationale does make sense.
Nufarm (NUF) Chart
Market Matters Take/Outlook
We have previously stated buying agriculture stocks into weather related weakness has merit making the continued weakness in Nufarm a potential buying opportunity. We will provide a more thorough view once the capital raise is complete and the FY19 result has been released.
