Indianapolis-based Corteva, Inc. (CTVA) primarily focuses on supplies to the agricultural input industry. Its products protect against weeds, insects, other pests, and diseases and enhance crop health. It operates through Seed and Crop Protection segments. With a market cap of $39.6 billion, Corteva’s operations span the Americas, the Indo-Pacific, Europe, the Middle East, and Africa.
The agriculture industry giant has lagged behind the broader market over the past year. CTVA stock has gained 19.8% on a YTD basis and 24.1% over the past year, lagging behind the S&P 500 Index’s ($SPX) rally of 24.7% in 2024 and 32.3% over the past 52 weeks.
Zooming in further, CTVA has outperformed the First Trust Indxx Global Agriculture ETF’s (FTAG) 7.6% decline in 2024 and 6% dip over the past 52-week period.
Shares of Corteva plunged 5% in the trading session after the release of its disappointing Q3 earnings on Nov. 6. The company has faced several challenges including competitive market dynamics in Latin America which impacted its pricing and sales coupled with unfavorable weather conditions in Europe, Middle East, and Africa region which led to a staggering 10.2% year-over-year decline in net sales to $2.3 billion, falling short of analysts’ topline expectations.
Meanwhile, the company observed a substantial increase in selling, general and admin expenses as a percentage of net sales and was unable to reduce other expenses, which led to a $633 million pre-tax losses from continued operations. Moreover, its adjusted loss per share of $0.49 missed analysts’ bottom-line estimates by a massive 58.6%, unsettling investors’ confidence.
Despite the recent headwinds and decline in profitability, Corteva is anticipating a double-digit operating EBITDA growth in 2025, driven by controllable factors and increased R&D investment and expects to achieve an enterprise goal of 21% to 23% EBITDA margin by 2025.
For the current fiscal year, ending in December, analysts expect a 3.7% year-over-year decline in adjusted EPS to $2.59. The company’s earnings surprise history is mixed. It surpassed analysts’ bottom-line estimates in three of the past four quarters while missing on one other occasion.
CTVA stock has a consensus “Moderate Buy” rating overall. Out of the 20 analysts covering the stock, 13 recommend “Strong Buy,” two advise “Moderate Buy,” and five suggest a “Hold” rating.
This configuration is slightly more bullish than a month ago, when 11 analysts recommended a “Strong Buy” rating.
On Nov. 8, Barclays PLC (BCS) analyst Benjamin Theurer maintained an “Equal-Weight” rating while raising the price target to $62.
CTVA’s mean price target of $65.33 represents a premium of 13.8% to current price levels. Meanwhile, the street-high target of $71 suggests a potential upside of 23.7%.
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