Nufarm has guided to $15m in operating earnings (EBITDA) improvement with the closure of manufacturing at Raymond Road and 2, 4-D synthesis at its site in Austria.
Credit Suisse believes the decision recognises the reality of sub-scale manufacturing positions.
The Raymond Road plant has operated below nameplate even in normal seasonal conditions.
The broker retains an Outperform rating and $6.74 target.
Target price is $6.74.Current Price is $4.09. Difference: $2.65 – (brackets indicate current price is over target). If NUF meets the Credit Suisse target it will return approximately 39% (excluding dividends, fees and charges – negative figures indicate an expected loss).