In what Morgans considers extremely strong FY21 guidance, GrainCorp is reaping the combined benefits of operational initiatives and the largest east coast winter grain crops on record.
The broker makes large upgrades to FY21 forecasts after recent weather conditions provided a positive backdrop for planting of the 2021/22 winter crop. In addition, FY22 earnings are considered to benefit from materially higher carry-over grain.
The next catalyst for the stock is the ABARES Crop Report on 16 February which is likely to be upgraded, predicts the analyst.
Add rating. The target increases to $5.52 from $4.71.
Sector: Food, Beverage & Tobacco.
Target price is $5.52.Current Price is $4.71. Difference: $0.81 – (brackets indicate current price is over target). If GNC meets the Morgans target it will return approximately 15% (excluding dividends, fees and charges – negative figures indicate an expected loss).
