Got in yesterday and am planning to top up over the course of...

Got in yesterday and am planning to top up over the course of this and next week...

RBS Australia 09/10/2009 1 Buy $9.00 25.9%
Target $9.00 (was $9.53). In the broker's view the company's acquisition of United Malt Holdings is a company transforming deal as it diversifies the group and adds stability as it moves to become a large international agribusiness going forward.

On its numbers the acquisition will be earnings per share accretive from FY10, though the dilution from the associated equity raising sees the broker lower its price target.

The shares are undervalued in its view and so the broker retains its Buy rating.

JP Morgan 07/10/2009 3 Neutral $8.80 23.1%
Management has revised profit guidance to a narrower range of between $60-$63m, and given this is above the broker's previous earnings forecast of $57.4m, it adjusts its numbers accordingly.

The company has also announced the acquisition of United Malt Holdings and the broker notes the deal should mean earnings are less vulnerable to seasonal variations.

As an equity raising will be used to fund part of the acquisition price, the broker sees scope for some short-term share price weakness. However, it suggests a placement price of around $7 per share would be an attractive entry level into the stock.

Neutral rating retained.