Tuesday, December 10, 2013

Seeking Alpha: Does New Management Mean New Opportunity For Alico?

Agriculture can be a tough place for publicly-traded companies. While the shares of Calavo Growers (CVGW) has chopped fairly steadily higher over time, long-term investors in ag names like Limoneira (LMNR), Chiquita Brands (CQB), and Fresh Del Monte (FDP). It's not just an American ag phenomenon either, as Brazilian companies like BrasilAgro (LND) and Sao Martinho (SMTO3.SA) have had some pretty major ups and downs as well.

That may be a little alarming for investors looking for a smooth ride from Alico (ALCO). While this Florida-based citrus, sugarcane, and land company has enjoyed a strong run from early 2012 despite difficult conditions in the citrus market, shares have slid throughout much of 2013. This is a stock that will require some patience, but appears to offer value. Provided that citrus greening and orange juice demand don't get markedly worse, it would seem that Alico's land holdings should support a fair value in the $40's. Moreover, while I'm not counting on this company generating particularly attractive cash flows from its existing farming options, new ownership and new management could surprise and add value.

Follow this link to continue:
Does New Management Mean New Opportunity For Alico?

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