Company Description
Bungee Ltd. operates in the food and agriculture business worldwide. The company was founded in 1818 and has a market cap of $10 billion.
With agriculture prices surging on strong demand and falling inventories, agribusiness companies have been strong. That trend lifter Bungee to better than expected Q3 results from early November that handily beat expectations.
Third-Quarter Results
Revenue for the period was up 3% from last year to $11.7 billion. Earnings also looked good, coming in at $2.26, 50% ahead of the Zacks Consensus Estimate.
The company's largest segment, Agribusiness, was up 10% from last year to $313 million. Its biggest gain came from a smaller segment, Millling Products, where sales increased 457% to $39 million. Sugar and Bio energy was also up big, with sales jumping 240% to #34 million.
Bungee also continues to work on its balance sheet, with its total debt falling $728 million from last year to $3.35 billion against cash and equivalents of $350 million.
Estimates
We have seen some decent movement in estimates over the last few months, with the current year up 94 cents to $4.02. The next-year estimate is pegged at $5.60, a bullish 39% growth projection.
Valuation
But in spite of the gains, Bungee still has value, trading with a forward PE of 12X against the industry average of 20X.
6-Month Chart
On the chart, shares have been grinding higher for the last few months, recently hitting a new 6-month high at $74.04 on more bullish news on agriculture. Look for support from the trend line on any weakness, take a look below.
Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the new Zacks Momentum Trader Service.
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