UBS observes wholesale trends continue to improve through January and mushroom pricing was particularly pleasing.
2019 guidance remains realistic for net profit of around $28m, in the broker’s view, and risks to 2020 guidance are reducing.
The broker continues to believe Costa Group should trade at a premium to listed peers although visibility over 2020 is unlikely to improve until early in the second quarter. Buy rating and $3.25 target maintained.
Sector: Food, Beverage & Tobacco.
Target price is $3.25.Current Price is $2.73. Difference: $0.52 – (brackets indicate current price is over target). If CGC meets the UBS target it will return approximately 16% (excluding dividends, fees and charges).
