BRF (BRFS)
has to be glad to put 2018 behind it, as the only real positives to
come out of that year will likely be the hiring of Pedro Parente as the
Chairman and CEO and the decision to launch a far-reaching deleveraging
and divestment program. Management’s projections for 2019 still look a
little on the bullish side, but the company does have a relatively solid
base in Brazil and Middle Eastern halal markets from which to rebuild
the business.
I do expect margins to improve from
here, but it won’t be a fast turnaround and I believe the company faces
ongoing challenges from competition within the Brazilian market and
protectionist measures in key export markets like Saudi Arabia. Although
a successful turnaround could likely support a fair value in the double
digits some years down the road, I believe a fair value in the $6 to $7
range remains reasonable today.
Read the full article here:
BRF Underway With Its Turnaround, But A Lot Of Self-Improvement Remains
No comments:
Post a Comment