Nufarm (NUF) is a global pesticide business with a strong local presence, they have endured issues through periods of sustained drought but theoretically will outperform in high yield crop years i.e. similar to IPL it comes with weather risks. The company reports today hence volatility is likely to be elevated as it has been for both IPL and ELD after their respective earnings. The stock closed yesterday within a few cents of its average for the last 3 ½ years hence we see reason to 2nd guess what comes next until we see some meaningful direction from the company.
- NUF has range traded between $7 and $3.30 for well over 3-years, assuming this continues current levels offer nothing in the way of risk/reward.
NB: NUF have just reported and it looks solid. Underlying EBITDA of $316m is down 4.2% YoY but above the $300m consensus while they still expect to grow this number overall in FY23 from FY22, something the market has factored in but not by a lot, while they talked to good demand for seed and crop protection in early 2H23 trading.
