Fundamental analysis: CORTEVA (#CTVA)


✅Corteva #CTVA is a large American agricultural chemical and seed company, the former agricultural arm of DowDuPont. The company specializes in the production of alfalfa, canola, corn, cotton, rice, sorghum, soy, sunflower and wheat seeds. It also manufactures crop protection products including herbicides, fungicides and insecticides. In addition, the company produces agricultural software.


⚡️Factors of growth:

  • Analysts predict positive outlook for global agriculture amid rising demand and prices for agricultural products.

  • Corteva can benefit from the scale of production and a wide range of new products.

  • The company also makes buybacks and dividend payments, which should have a positive impact on profitability


📖 Financial indicators

  • Below Fair Value: CTVA is trading below our fair value estimate at $50.00

  • Earnings vs Market: Earnings from CTVA (18.4% per year) are expected to grow faster than the US market (15.2% per year).

  • Growing Profit Margin: CTVA's current net profit margins (7.4%) are higher than last year (1.2%).

  • Earnings Trend: CTVA has become profitable over the past 5 years, increasing earnings by 6% per year.

  • Short-Term Liabilities: CTVA's short-term assets ($ 15.0 billion) outweigh its short-term liabilities ($ 9.0 billion).

  • Long-Term Liabilities: CTVA's short-term assets ($ 15.0 billion) outweigh its long-term liabilities ($ 8.8 billion).

  • Debt level: CTVA's debt / equity ratio (7.9%) is considered satisfactory.

  • Debt coverage: CTVA's debt is well covered by operating cash flow (104.5%)

  • Substantial dividend: CTVA's dividend (1.13%) is below the lower end dividend payers in the US market (1.26%).


Entry range $ 40.00 - $42.00

Target $ 50.00

Stop loss $ 37.00

OTB Global Investments

12 July 2021


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