Coffee with MarkZ and Mr. Cottrell. 09/01/2023

3 Stocks to Watch in the Thriving Agriculture - Products Industry, 1 SEPT

 ANDE  

BG  RKDA

The Zacks Agriculture - Products industry will benefit from the stable demand for food, supported by a growing population. Increasing consumer awareness regarding food ingredients and the preference for healthier alternatives will continue to boost the industry’s growth prospects. Alternative and innovative agricultural technologies like hydroponics and vertical farming are expected to be other key catalysts, given their inherent benefits.

Players like Bunge Limited (BG - Free Report) , The Andersons, Inc. (ANDE - Free Report) and Arcadia Biosciences (RKDA - Free Report) are poised well to gain from strong end-market demand and their ongoing growth initiatives.

Industry Description

The Zacks Agriculture – Products industry comprises companies that are either involved in storing agricultural commodities, distributing ingredients to others, or engaged in farming crops, livestock and poultry products. Some are engaged in purchasing, storing, transporting, processing and selling agricultural commodities or products derived from the same. They operate grain elevators, wherein income is earned from commodities bought and sold using these elevators or held as inventory. Some companies provide nutrients, advanced indoor and greenhouse lighting, environmental control systems, and accessories for hydroponic gardening — the method of growing plants using mineral nutrient solutions in a water solvent instead of soil. A few players are offering innovative, plant-based health and wellness products. Companies producing lumber also fall under this industry.

Trends Shaping the Future of the Agriculture - Products Industry

Solid Demand to Support Industry: Demand for food is directly influenced by population and demographic changes beside income growth and income distribution. Per the United Nations, the global population will rise to 8.5 billion in 2030 and 9.7 billion in 2050. This would lead to a 50% increase in global food demand. Also, in response to growing consumer demand for healthier food alternatives, a number of agricultural and food-based companies are investing in innovation, and augmenting their product and market strategies to bring new quality and healthy food ingredients to the market. Ongoing improvements in grain-handling techniques and investment in larger storage spaces should aid the industry’s growth. Plus, stable earnings across all cycles are ensured, considering the industry’s products are always in demand, irrespective of the condition of the economy.

Hydroponics & Cannabis Are Key Catalysts: Hydroponics is gaining popularity as it gives growers the ability to better regulate and control nutrient delivery, light, air, water, humidity, pests and temperature in an indoor setting. It can help produce crops faster with higher yields than traditional soil-based growers. It is being utilized in new and emerging industries, including the cultivation of cannabis and hemp. Vertical farms producing organic fruits and vegetables also utilize hydroponics due to a rising shortage of farmland, as well as environmental vulnerabilities. Also, vertical farming is the latest agricultural technology, wherein companies use shelves and artificial light to grow produce, minimizing land and water consumption. Total sales for the hydroponic equipment industry are projected to surpass $16 billion by 2025. Even though the cannabis industry is undergoing a rough patch due to an oversupply, its long-term prospects are intact. In the United States, several states have legalized cannabis for medical or recreational use, representing the largest market in the world. By 2027, spending on legal cannabis is expected to reach $47.3 billion in North America.

High Costs to Hurt Margins: Players in the industry are facing rising labor, packaging and distribution costs, among other expenses. Companies engaged in animal products have been facing rising production costs for a while due to elevated feed ingredient prices . Even though feed prices are expected to ease somewhat from the peak levels, it still remains high the industry continues to navigate a tight labor market with a spike in wages and higher distribution costs. Supply-chain headwinds are also expected to be concerning in the near term. Companies are consistently implementing cost-reduction actions and pricing strategies to sustain margins in the current scenario.

Zacks Industry Rank Indicates Bright Prospects

The Zacks Agriculture - Products industry is part of the broader Zacks Basic Materials sector. The industry currently carries a Zacks Industry Rank #111, which places it in the top 44% of the 252 Zacks industries.

The group’s Zacks Industry Rank, basically the average of the Zacks Rank of all the member stocks, indicates bright prospects in the near term. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Before we present a few stocks worth considering for your portfolio, let’s look at the industry’s recent stock market performance and valuation.

 

Industry Versus Broader Market

The Zacks Agriculture – Products industry has underperformed its sector and the Zacks S&P 500 composite over the past 12 months. Stocks in this industry have gained 5.5% in the past 12 months compared with the S&P 500’s growth of 15.0% and the Basic Materials sector’s rise of 14.8%.

One-Year Price Performance

 

Industry's Current Valuation

On the basis of the trailing 12-month EV/EBITDA ratio, a commonly used multiple for valuing Agriculture - Products stocks, we see that the industry is currently trading at 5.20X compared with the S&P 500’s 13.44X. The Basic Materials sector’s trailing 12-month EV/EBITDA is 10.08X. This is shown in the charts below.

Enterprise Value/EBITDA (EV/EBITDA) Ratio (TTM)

Enterprise Value/EBITDA (EV/EBITDA) Ratio (TTM)

Over the last five years, the industry has traded as high as 12.82X and as low as 3.10X, with the median being 6.75X.

 

3 Agriculture - Products Stocks to Watch

Andersons: The company recently closed the acquisition of ACJ International, a pet food ingredient supplier that is in sync with its strategy to grow in the premium pet food ingredient industry. Aided by its effective working capital management, the company has managed to lower short-term debt to $103 million at the end of the second quarter of 2023 from the $1.2 billion at the end of the year-ago quarter. The company has managed to keep the long-term debt to EBITDA at less than its targeted 2.5 times. It is continuing to execute its strategy in its core grain and fertilizer verticals, including a greater focus on renewables and opportunities in renewable diesel feedstocks. The company’s shares have gained 41% in a year.

Maumee, OH-based Andersons operates in trade, renewables and plant nutrient sectors in the United States and internationally. The Zacks Consensus Estimate for ANDE’s earnings for fiscal 2023 has moved up 22% in the past 60 days. The company has a trailing four-quarter earnings surprise of 64.4%, on average. ANDE has a trailing four-quarter earnings surprise of 64.4%, on average. The company currently sports a Zacks Rank #1 (Strong Buy).

You can see the complete list of today’s Zacks #1 Rank stocks here. 

Price & Consensus: ANDE

Arcadia Biosciences: The company has been streamlining its business to focus on higher-margin brands, while aggressively managing costs. Aided by its efforts, the second quarter of 2023 saw the lowest quarterly operating expenses since the fourth quarter of 2020. The company plans to sell its two remaining Body Care brands. It expects streamlined operations and organizational changes to lead to savings of $2 million in operating expenses in the remainder of 2023 and $3-$4 million annually. This move will help it focus on the more promising GoodWheat and Zola brands. Its GoodWheat flour recently entered the $850-million baking mix category with the launch of better-for-you pancake and waffle mixes. Zola coconut water has reversed its downward distribution trend in the second quarter of 2023. RKDA plans to ramp up innovation for the brand, with some flavor launches expected in the first quarter of 2024. The company’s shares have lost 89.6% in a year but are expected to trend up eventually, backed by the above-mentioned tailwinds.

Arcadia is a producer and marketer of innovative, plant-based health and wellness products. RKDA used non-genetically modified advanced breeding techniques to develop its proprietary innovations, which it is now commercializing by selling seed and grain, food ingredients and products, hemp extracts, trait licensing, and royalty agreements. Over the past 60 days, the Zacks Consensus Estimate for this Davis, CA-based player’s fiscal 2023 earnings has narrowed from the previously stated loss of 21.85 per share to a loss of $11.05. RKDA has a trailing four-quarter earnings surprise of 41%, on average. It currently carries a Zacks Rank #2 (Buy).

Price & Consensus: RKDA

Bunge: The company’s shares have gained 19% since it announced entering a definitive agreement with Viterra Limited in June. This merger will create an innovative global agribusiness company with an enhanced global network, and grain and softseed handling capacity. With a diversified mix across geographies, seasonal cycles and crops, the company will be better positioned to manage risk and increase resiliency. BG also recently reported upbeat second-quarter 2023 results, with adjusted earnings improving 25% year-over-year. In the Agribusiness segment, results were driven by softseed crush and strong Brazil soybean origination, which also contributed to higher crush results in Brazil, and crush operations in Europe and Asia. The Refined & Specialty Oils segment has been gaining on strong food and fuel demand. The company’s shares have gained 15.4% in the past year.

Bunge is an integrated global agribusiness and food company covering the farm-to-consumer food chain. The Zacks Consensus Estimate for this St. Louis, MO-based player’s ongoing-year earnings has moved up 5% to $12.13 over the past 60 days. BG has a trailing four-quarter earnings surprise of 20.4%, on average. It carries a Zacks Rank #3 (Hold) at present.

Price & Consensus: BG

 

Zacks Names "Single Best Pick to Double" 

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

It’s credited with a “watershed medical breakthrough” and is developing a bustling pipeline of other projects that could make a world of difference for patients suffering from diseases involving the liver, lungs, and blood. This is a timely investment that you can catch while it emerges from its bear market lows.

It could rival or surpass other recent Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.

https://www.zacks.com/commentary/2143654/3-stocks-to-watch-in-the-thriving-agriculture---products-industry?art_rec=home-home-investment_ideas_stocks-ID07-txt-2143654

Iraqi Dinar Rv Countdown Started / Iraqi Dinar Revaluation News Last 24 ...

Sabah Sobhi: The oil and gas law is still in the drafting process, 1 SEPT

 Sabah Sobhi: The oil and gas law is still in the drafting process

31/08/2023

Sabah Sobhi - The oil and gas law is still in the drafting processThe Parliamentary Oil, Gas and Natural Resources Committee revealed today, Thursday, that the draft oil and gas law, which has been stalled for years, is still in the process of “writing its draft.” Reliance that the law will be approved in the current parliamentary session if it is completed by the government.

Committee member Sabah Sobhi told Al-Sabah newspaper, followed by NRT Arabia, that “the oil and gas law is still in the process of writing its draft, which is the first stage in the enactment of any law, as this law needs a comprehensive political consensus, as it is a sensitive law that needs In-depth study and discussion by political parties.

Sobhi explained, “The law includes many dimensions, the most important of which is the economic dimension, which is the most important, because the enactment of this law leads to the structuring of the Iraqi economy, and the second dimension is the legal one because until now there is a legal vacuum with the existence of a constitutional article related to oil that requires the enactment of a law of its own.”

He added, “As for the third dimension, it is political, given that the issue of the oil commodity is very important from a political point of view, as it is the main revenue on which the economy and the Iraqi state depend, because 90% of the country’s budget depends on oil imports, so we need to legislate this law, and another after It is the technical dimension because oil is full of techniques from exploration until we reach sale, so we are in the process of enacting an important, complex, sensitive and fateful law for Iraq.

nrttv.com

Adviser to the Prime Minister: Iraq has not recorded any failure in the timing of the payment of its debts

2023-08-31

Adviser to the Prime Minister - Iraq has not recorded any failure in the timing of the payment of its debtsWednesday, the Advisor to the Prime Minister for Financial Affairs, Mazhar Muhammad Salih, considered the World Bank’s estimate of Iraq’s debts at more than $150 billion exaggerated and unreal, and while confirming the high creditworthiness of Iraq, he indicated that no failure was recorded in the timing of debt repayment in more than a decade. from time.

Salih said in a press statement, “The issue of the Iraqi public debt requires a professional distinction of its history and details, and not taking its numbers on their minds without a clear logical analysis. When evaluated in foreign currency, it is estimated at about $54 billion, while the external debt payable until the year 2028 is estimated at about $23 billion, and there are debts due after the year 2028, so the external debt becomes about $30 billion.

He added, “There is a debt pending on the Paris Club agreement of 2004, i.e. sovereign debts before 1990 belonging to four Gulf countries and four other countries, which are about $40 billion, and if they are activated, if they are correct (because they are, as the economic terminology termed, reprehensible debts because they financed the Iraq-Iran war.” At that time, if it is correct again, it must be deducted by 80% or more under the Paris Club agreement for the year 2004, to be less than $ 9 billion or less.

And Saleh continued, commenting on what the World Bank mentioned in its new report that Iraq’s debt exceeds 150 billion dollars: He said, “We do not know the method of calculating the debt in the World Bank report. Aside from it, for the external debt to reach 50 billion dollars, as an expectation of the total internal public debt early, which was not achieved, and therefore the reading of Iraq’s internal and external debts, according to what was published by the World Bank, came to be about 152 billion dollars, and this is exaggerated rather than being At about $84 billion (excluding the balance attached to the Paris Club agreement as an abhorrent debt) and what has been published about debt balances is unreal and discretionary.

He pointed out, “Nevertheless, the public debt-to-GDP ratio, even in light of its unjustified inflation, will remain between 54-57% of the estimated GDP for the year 2023, and it is within the current safe economic stability area, which is usually estimated at about 60%.”

And the advisor to the Prime Minister for Financial Affairs warned, “The financial policy in Iraq adopts a highly disciplined system in adjusting the timing of payment of debt dues (annual installments and interest) or when extinguishing the debt once on its annual due dates, and there are fixed and accurately estimated annual allocations that are monitored in the budget.” The public early to pay debt services and dues, especially Iraq’s foreign debts, and no failure has been recorded in Iraq during a decade and a half, and this is what made Iraq’s credit worthiness high, as Iraq is located within Area B in the global credit rating tables that are evaluated by international credit rating companies. Known and periodically since 2015 until today.

Saleh explained, “The vast majority of internal public debt is in the possession of government financial institutions or the government banking system, which is an (exclusive) internal governmental matter. There is a strategy in dealing with this debt, especially since the monetary authority currently acquires about 64% of the total internal debt and has the ability to In managing it in coordination with financial policy and with high accuracy, bearing in mind that the banking system annually obtains interest on that debt at a rate of 3%, and it falls within the annual allocations of the general budget.

burathanews.com

"RV UPDATE" BY TEXAS SNAKE & MARKZ, 1 SEPT

  Texas Snake

  On Wed. 30 Aug, very positive news about appointment notifications possibly being released. A banker was told to have all his trained exchange personnel at their exchange locations starting Wednesday and forth going.

MarkZ 

  [via PDK]  Question:  Can Iraq do everything in their budget with the 1100 rate that is going now?

  MarkZ answer:  No, it will be in the hole if they do it with the 1132 rate...but it gets them a lot closer though.

  Question:  What do you estimate the NEER [Nominal Effective Exchange Rate] rate would be necessary to do their projects? 

 MarkZ answer:  About $1.30 based on all the math that we have done, that many have done, would be the cheapest NEER rate that they can get away with, but then again they won't be able to achieve the final value that they want if the come in that low.

...RV news...chatter among the banking folks... possible within the next 72 hours is the chatter amongst bankers and groups...government contacts think as far out as the 9th, that is what they are hearing right now,  banking contacts think we are much closer than that...my redemption contacts are working on Sunday, which is unusual...

I'm not getting anything negative...I still have group leaders that think we are going to break all speed records and still think we will get things done in the month of August, between now and tomorrow night at midnight.  They are going to have to do something quickly if they are going to meet those deadlines...it's encouraging.

World Bank & CBI Meetings?💣Exchanging Sept 1st?🤔Iraq Dinar RV Updates | ...

"RV UPDATE" BY FRANK26 & MARKZ, 1 SEPT

  Frank26  

 It's the World Bank that is constantly meeting with the CBI governor and Sudani right now.  The reason why is because of the reforms...They can't make it any more clear...They are making sure Iraq is set up with external transfers.  This is all for the banking reform education.

1320 is not the official rate...that's just the street rate...They told you very plainly 1132 is the official exchange rate today.  I'm not saying they're using 2 exchange rates.  That's against the law.  But there's nothing against the law to have two sets of books.  The CBI website may show 1320 but IMO the economic reforms are at a different rate with permission to do so.  

MarkZ  

 [via PDK]  ...I do have an update from the redemption side/wealth management. They are saying they were asked to stay close to home this week…in case they are needed. It may have nothing to do with us and exchanges…but something internal. I don’t know as of yet.

  I'm not getting anything negative...I still have group leaders that think we are going to break all speed records and still think we will get things done in the month of August, between now and tomorrow night at midnight.  They are going to have to do something quickly if they are going to meet those deadlines...it's encouraging.