With a market cap of $10.9 billion, Bunge Global SA (BG) is a leading global agribusiness and food company that operates across the farm-to-consumer food chain, providing essential products and services on five continents. The Chesterfield, Missouri-based company operates through four key segments: Agribusiness; Refined and Specialty Oils; Milling; and Sugar and Bioenergy.
Companies valued at more than $10 billion are generally considered “large-cap” stocks, and Bunge fits this criterion perfectly. It processes and markets a wide range of agricultural commodities, including oilseeds, grains, and vegetable oils, serving industries such as animal feed, biofuel, food manufacturing, and retail. Bunge combines a rich legacy with a global presence to address the world's food and energy needs.
However, the agribusiness giant pulled back 32.1% from its 52-week high of $114.92, recorded in July. Shares of Bunge have declined 18.6% over the past three months, lagging behind the Consumer Staples Select Sector SPDR Fund’s (XLP) 3.8% decrease over the same time frame.
In the long term, BG stock is down 27.2% over the past six months, underperforming XLP’s 3.2% rise. Moreover, shares of Bunge have dipped 23.8% over the past 52 weeks, compared to XLP’s 11.4% return over the same time frame.
BG stock has been trading below its 50-day and 200-day moving averages since August.
Despite reporting better-than-expected Q3 adjusted EPS of $2.29, shares of Bunge fell 2.3% on Oct. 30 due to broader concerns about declining profitability and narrowing margins in its key segments. The 22% year-over-year drop in adjusted earnings for Agribusiness, its largest segment, highlighted weak oilseed processing margins in North America and Asia. Additionally, its refined and specialty oils segment saw a 21% drop in profit despite higher volumes, raising doubts about sustained growth. Investors were also likely disappointed by the company's full-year profit outlook of "at least $9.25" per share, which fell short of analysts' $9.43 expectations.
In comparison, rival Ingredion Incorporated (INGR) is outperforming BG. Shares of Ingredion have gained 27.2% over the past 52 weeks and 21.7% over the past six months.
Despite BG’s weak price action, seven analysts covering the stock have a consensus rating of “Strong Buy.” The mean price target of $105.62 suggests a premium of 35.3% to current levels.
