Jefferies analyst Akshay Jagdale maintained a Sell rating on Sanderson Farms (SAFM) today and set a price target of $77. The company’s shares closed yesterday at $96.02, close to its 52-week low of $94.57.
Jagdale observed:
“SAFM is scheduled to report fiscal 4Q18 (Oct) results this Thursday. We expect weak 4Q18 results and for the trend to continue into FY19 owing to an oversupply of chicken (weak demand and to a lesser extent supply growth) which has resulted in a significant decline in chicken prices. With processing capacity slated to expand by ~3% in 2019 and continued weak demand, we remain UW SAFM despite the stock’s underperformance.”
According to TipRanks.com, Jagdale is a 3-star analyst with an average return of 0.6% and a 47.5% success rate. Jagdale covers the Consumer Goods sector, focusing on stocks such as Lamb Weston Holdings, McCormick & Company, and Conagra Brands Inc.
Sanderson Farms has an analyst consensus of Moderate Sell, with a price target consensus of $86.
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Based on Sanderson Farms’ latest earnings release for the quarter ending July 31, the company reported a quarterly net profit of $11.31 million. In comparison, last year the company had a net profit of $71.77 million.
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Sanderson Farms, Inc. is a poultry processing company that engages in the production, processing, marketing and distribution of fresh, frozen, further processed and partially cooked chicken products. It operates through three divisions: Production, Processing, and Foods. The Production division refers to the production of chickens to the broiler stage.
