Jefferies just double-upgraded Yara International (OB:YAR) to buy, driven by three key trends: a tightening nitrogen market, declining gas costs, and changes to Europe’s climate policy that could reshape Yara’s competitive footing from 2026.
After a strong run in 2024, Yara International is showing renewed momentum. Its share price has gained 24.27% year-to-date, while the total shareholder return over the past year stands at 22.29%. That combination of short-term gains and improving fundamentals suggests investors are warming up to Yara’s long-term growth story, especially as climate policy shifts start to favor the company.
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So after this impressive rally and a double-upgrade from analysts, is Yara International’s current valuation leaving room for upside, or have investors already priced in the company’s improving prospects and policy tailwinds?
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Most Popular Narrative: 30% Undervalued
Analysts currently set Yara International's fair value at NOK 380.17, roughly 0.3% above the last close of NOK 378.90. This positions the company as an attractive value opportunity, especially given the perceived underappreciation of its cost control and policy advantages.
The market appears to be pricing in sustained strong demand for value-added and specialty fertilizers, where Yara is a leader, based on long-term increases in agricultural productivity needs and adoption of climate-smart farming. However, current order books and commentary indicate only flat to modest growth in volumes and margins for these products. If the shift to precision agriculture or specialty products stalls, future revenue and net margin expansion could disappoint.
Curious what bold projections justify Yara’s valuation bump? There’s a twist: the secret sauce behind this target is not just optimism, but a careful juggling act of expected margin shifts, revenue pressures, and future profitability assumptions. Want to see what’s making analysts rethink their stance? Peel back the layers in the full narrative.
However, policy support in the US or Europe, or Yara’s efficient cost controls, could tilt the outlook and drive higher margins than currently expected.
Another View: Are Multiples Sending a Different Signal?
Looking beyond price targets, Yara International is trading at a price-to-earnings ratio of 13.1x, which is more attractive than both the European Chemicals industry average of 17.9x and the peer group average of 19.3x. However, this is only slightly above its fair ratio of 12.8x. This suggests the stock’s discount might be slimmer than it first appears. Is there more value to be found, or is this a value trap in disguise?
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A great starting point for your Yara International research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.
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