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Analysts at Jefferies have raised the price target for Nufarm (ASX: NUF) by 12% to AU$5.30, signaling optimism in the crop protection and seed technology company's future growth. This comes despite Nufarm's recent first-half underlying EBITDA report of AU$217 million ($143.31 million), which fell short of the Visible Alpha consensus estimate of AU$246 million, as noted by Citi.
Jefferies' Optimism on Revenue Goals
Jefferies remains positive on Nufarm's long-term prospects, highlighting the company's ambitious target of achieving at least AU$3.8 billion in crop protection revenue by FY26. This target represents a 25% increase from FY24 forecasts and hinges significantly on the success of Nufarm's new product pipeline. Jefferies' updated price target reflects their confidence in the company's ability to meet these goals.
Citi's Cautionary Downgrade
Contrasting Jefferies' optimism, Citi has downgraded Nufarm from "buy" to "neutral" and reduced its price target from AU$5.80 to AU$4.80. Citi's cautious stance is influenced by the recent earnings miss and their need for more tangible evidence of price improvements in active ingredients. "For us to turn more positive, we would like to see more concrete evidence of price uplift in active ingredients which should then flow through to Crop Protection products," Citi stated.
Mixed Analyst Sentiments
Morningstar maintains a more bullish outlook, keeping its price target at AU$7.70, citing Nufarm's reaffirmation of its FY26 revenue forecast. This divergence in analyst opinions underscores the uncertainty and varied expectations surrounding Nufarm's performance.
Currently, four out of twelve analysts rate Nufarm as a "buy" or higher, while eight recommend holding the stock. The median price target among analysts is A$5.45, according to LSEG data.
Market Performance and Outlook
As of the last close, Nufarm's stock is down 9.4% year-to-date, reflecting investor concerns following the company's underwhelming first-half earnings report. Despite this decline, the adjustments in price targets and ratings by various analysts highlight the ongoing debate over Nufarm's ability to achieve its ambitious revenue goals.
