Nufarm (ASX:NUF) - Share price, News & Analysis

Q: What is the Fair Price of NUF when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

NUF (A$5.31) is trading below our estimate of [[fair value]] (A$10.83)

NUF fundamental analysis
Snowflake Score
Valuation	3/6
Future Growth	2/6
Past Performance	3/6
Financial Health	6/6
Dividends	3/6

NUF Stock Overview

Rewards

Trading at 51% below our estimate of its fair value

Earnings are forecast to grow 13.8% per year

Became profitable this year

Risk Analysis

NUF passed our risk checks.

Nufarm Competitors

Sandfire Resources

ASX:SFR

AU$2.0b

Perseus Mining

ASX:PRU

AU$2.2b

Regis Resources

ASX:RRL

AU$1.2b

CSR

ASX:CSR

AU$2.3b

Price History & Performance

Summary of all time highs, changes and price drops for Nufarm
Historical stock prices
Current Share Price	AU$5.31
52 Week High	AU$6.93
52 Week Low	AU$4.09
Beta	0.45
1 Month Change	2.11%
3 Month Change	-8.76%
1 Year Change	16.70%
3 Year Change	18.79%
5 Year Change	-39.80%
Change since IPO	167.71%

Recent News & Updates

May 26

An Intrinsic Calculation For Nufarm Limited (ASX:NUF) Suggests It's 49% Undervalued

Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Nufarm Limited...

Shareholder Returns

	NUF	AU Chemicals	AU Market
7D	1.0%	1.0%	0.7%
1Y	16.7%	10.4%	-4.8%

Return vs Industry: NUF exceeded the Australian Chemicals industry which returned 10.4% over the past year.

Return vs Market: NUF exceeded the Australian Market which returned -4.8% over the past year.

Price Volatility

Is NUF's price volatile compared to industry and market?
NUF volatility
NUF Average Weekly Movement	5.6%
Chemicals Industry Average Movement	11.7%
Market Average Movement	10.6%
10% most volatile stocks in AU Market	17.8%
10% least volatile stocks in AU Market	4.6%

Stable Share Price: NUF is less volatile than 75% of Australian stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: NUF's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1916	2,737	Greg Hunt	https://www.nufarm.com

Nufarm Limited, together with its subsidiaries, develops, manufactures, and sells crop protection solutions and seed technologies in Europe, the Middle East, Africa, North America, and the Asia Pacific. It operates through two segments, Crop Protection and Seed Technology. The company’s protection solutions include herbicides, insecticides, and fungicides that help growers protect crops against weeds, pests, and diseases.

Nufarm Fundamentals Summary

How do Nufarm's earnings and revenue compare to its market cap?
NUF fundamental statistics
Market Cap	AU$2.02b
Earnings (TTM)	AU$95.23m
Revenue (TTM)	AU$3.73b

21.2x

P/E Ratio

0.5x

P/S Ratio

Is NUF overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
NUF income statement (TTM)
Revenue	AU$3.73b
Cost of Revenue	AU$2.79b
Gross Profit	AU$945.67m
Other Expenses	AU$850.43m
Earnings	AU$95.23m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

Nov 16, 2022

Earnings per share (EPS)	0.25
Gross Margin	25.34%
Net Profit Margin	2.55%
Debt/Equity Ratio	38.4%

How did NUF perform over the long term?

See historical performance and comparison

Dividends

1.5%

Current Dividend Yield

32%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is NUF undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

3/6

Valuation Score 3/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for NUF?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for NUF. This is calculated by dividing NUF's market cap by their current preferred multiple.
What is NUF's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	AU$2.02b

NUF key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.7x
Enterprise Value/EBITDA	7.9x
PEG Ratio	1.5x

Price to Earnings Ratio vs Peers

How does NUF's PE Ratio compare to its peers?

NUF PE Ratio vs Peers

The above table shows the PE ratio for NUF vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	11.1x
SFR Sandfire Resources	10.3x	-0.2%	AU$2.0b
PRU Perseus Mining	11.7x	26.2%	AU$2.2b
RRL Regis Resources	13.8x	12.3%	AU$1.2b
CSR CSR	8.5x	-5.7%	AU$2.3b
NUF Nufarm	21.2x	13.8%	AU$2.0b

Price-To-Earnings vs Peers: NUF is expensive based on its Price-To-Earnings Ratio (21.2x) compared to the peer average (11.1x).

Price to Earnings Ratio vs Industry

How does NUF's PE Ratio compare vs other companies in the Global Chemicals Industry?

Price-To-Earnings vs Industry: NUF is expensive based on its Price-To-Earnings Ratio (21.2x) compared to the Global Chemicals industry average (16.2x)

Price to Earnings Ratio vs Fair Ratio

What is NUF's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

NUF PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	21.2x
Fair PE Ratio	19.2x

Price-To-Earnings vs Fair Ratio: NUF is expensive based on its Price-To-Earnings Ratio (21.2x) compared to the estimated Fair Price-To-Earnings Ratio (19.2x).

Share Price vs Fair Value

What is the Fair Price of NUF when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: NUF (A$5.31) is trading below our estimate of fair value (A$10.83)

Significantly Below Fair Value: NUF is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.

Discover undervalued companies

Future Growth

How is Nufarm forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

Future Growth Score

2/6

Future Growth Score 2/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

13.8%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: NUF's forecast earnings growth (13.8% per year) is above the savings rate (1.8%).

Earnings vs Market: NUF's earnings (13.8% per year) are forecast to grow faster than the Australian market (6.1% per year).

High Growth Earnings: NUF's earnings are forecast to grow, but not significantly.

Revenue vs Market: NUF's revenue is expected to decline over the next 3 years (-0.5% per year).

High Growth Revenue: NUF's revenue is forecast to decline over the next 3 years (-0.5% per year).

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: NUF's Return on Equity is forecast to be low in 3 years time (5.6%).

Discover growth companies

Past Performance

How has Nufarm performed over the past 5 years?

Past Performance Score

3/6

Past Performance Score 3/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-29.0%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: NUF has high quality earnings.

Growing Profit Margin: NUF became profitable in the past.

Past Earnings Growth Analysis

Earnings Trend: NUF has become profitable over the past 5 years, growing earnings by -29% per year.

Accelerating Growth: NUF has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.

Earnings vs Industry: NUF has become profitable in the last year, making it difficult to compare its past year earnings growth to the Chemicals industry (196.9%).

Return on Equity

High ROE: NUF's Return on Equity (4.8%) is considered low.

Discover strong past performing companies

Financial Health

How is Nufarm's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: NUF's short term assets (A$2.9B) exceed its short term liabilities (A$1.7B).

Long Term Liabilities: NUF's short term assets (A$2.9B) exceed its long term liabilities (A$802.2M).

Debt to Equity History and Analysis

Debt Level: NUF's net debt to equity ratio (16.7%) is considered satisfactory.

Reducing Debt: NUF's debt to equity ratio has reduced from 61.2% to 38.4% over the past 5 years.

Debt Coverage: NUF's debt is well covered by operating cash flow (37.4%).

Interest Coverage: NUF's interest payments on its debt are well covered by EBIT (3.1x coverage).

Balance Sheet

Discover healthy companies

Dividend

What is Nufarm current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

1.51%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: NUF's dividend (1.51%) isn’t notable compared to the bottom 25% of dividend payers in the Australian market (2.57%).

High Dividend: NUF's dividend (1.51%) is low compared to the top 25% of dividend payers in the Australian market (6.31%).

Stability and Growth of Payments

Stable Dividend: NUF's dividend payments have been volatile in the past 10 years.

Growing Dividend: NUF's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (31.9%), NUF's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its low cash payout ratio (19.4%), NUF's dividend payments are well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

4.6yrs

Average management tenure

CEO

Greg Hunt (63 yo)

7.25yrs

Tenure

AU$2,571,792

Compensation

Mr. Gregory Allan Hunt, also known as Greg, Grad. Dip., Mgmnt, AMP Harvard, AICD, REBA, AGSM, has been the Chief Executive Officer and Managing Director of Nufarm Limited since May 05, 2015. Mr. Hunt serve...

CEO Compensation Analysis

Compensation vs Market: Greg's total compensation ($USD1.78M) is about average for companies of similar size in the Australian market ($USD1.59M).

Compensation vs Earnings: Greg's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: NUF's management team is considered experienced (4.6 years average tenure).

Board Members

Experienced Board: NUF's board of directors are considered experienced (6.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: NUF insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/18 00:00
End of Day Share Price	2022/08/18 00:00
Earnings	2022/03/31
Annual Earnings	2021/09/30