In far from perfect conditions, Ruralco has delivered a very strong result, the broker suggests. Cash flow, profitability and margins are far superior to Elders ((ELD)). RHL’s strong balance sheet means it can take advantage of opportunities while still delivering solid dividends, the broker notes.
Forecast earnings rise 16% in FY12-13. target rises to $4.45 from $3.80. RHL remains the broker’s top ag pick.
Sector: Commercial Services & Supplies.
Target price is $4.45.Current Price is $3.40. Difference: $1.05 – (brackets indicate current price is over target). If RHL meets the RBS Australia target it will return approximately 24% (excluding dividends, fees and charges – negative figures indicate an expected loss).