Have Elders (ELD) shares hit the bottom?
Just asking on Elders shares have they hit the floor and now bouncing back
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Answer
Hi Timothy,
Elders (ELD) provided a very weak 1H report last week and the stock has since traded to a 3-year low without seeing any significant bounce as yet. The agriculture stock faced a number of headwinds in the first 6 months of the year particularly around livestock and fertilizer prices weighing on the result. Guidance suggests prices are expected to improve in the second half, though that increases the risk of the company missing expectations for the full year on guidance that was already 8% below consensus.
The stock is cheap but investors are clearly not buying the company’s commentary, just yet. We like Elders over the medium term, however we have seen shares underperform for long periods this year. The key for ELD now will be the appointment of a CEO following a global search – we’d wait for that before trying to catch this one.
We originally flagged our concerns around Elders here, having met with the Chairman only a few weeks before the poor update.
