There's no question that the biggest value-driving events for Monsanto (NYSE:MON)
are yet to come, as this leading agriculture technology company will
have to go through what is sure to be a rigorous regulatory oversight
process to get to the finish line with its would-be suitor Bayer (OTCPK:BAYRY) and deliver the $128/share in cash that a successful deal promises.
In
the meantime, Monsanto is Monsanto. The ag market is still in recovery
mode, and 2017 is not likely to be a banner year for acreage, but
Monsanto is doing well with new launches in South America and continues
to upgrade its product portfolio in North America. What's more, Monsanto
has long been an R&D-driven story and management hasn't been shy
about continuing to reinvest and expand that research pipeline. While
the shares do trade above my estimate of standalone fair value, it seems
as though today's price factors in only about a 20% chance of the deal
going through, and that strikes me as a reasonable risk/reward.
Click here for more:
Monsanto Holding Serve Ahead Of Regulatory Debates
No comments:
Post a Comment