Agriculture
August 29, 2012
Favorable poultry pricing dynamics allowed MHP to report an outstanding set of 2Q12 financials. The company’s top line was up by 27% YoY to USD 357mn, with the bottom line jumping by 83% YoY to a quarterly record USD 122mn. EBITDA advanced by 45% to USD 147mn, as a 25% increase in the achieved poultry selling price easily outpaced a 5% increase in unit production costs. With MHP set to expand its poultry capacity by about 14% in 2013, we reiterate our BUY recommendation for the MHPC stock at a target price of USD 24.0, implying an upside of 78%.
