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(Sharecast News) - Analysts at Canaccord Genuity lowered their target price on agricultural business Wynnstay from 520.0p to 470.0p on Friday, stating the group was "battling through adversity".
On Wednesday, Wynnstay said its FY24 performance would be below internal expectations, principally due to the underperformance of its feed division and fertiliser blending at Glasson Grain. Despite softer pricing, most of the downturn was driven by lower demand, likely due to farmers adopting a cautious approach following last year's severe losses due to biblical rainfall.
However, Canaccord Genuity noted that other segments, such as Wynnstay's arable unit, performed in line with expectations, and pointed out that its agri-merchanting arm even slightly exceeded them.
"We remain cautious about the final 2024 results but anticipate a more stable 2025, provided favourable weather conditions," said the Canadian bank, which reiterated its 'buy' rating on the stock.
"This H2-24 period has been particularly tough for Wynnstay, but we still believe in the value of the stock. We remain confident that the business, given its asset-backed nature and good cash generation, remains undervalued."
Reporting by Iain Gilbert at Sharecast.com
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