Citi Maintains 'Hold' Rating on Bunge Ltd (BG), Slashes Price Target

September 4, 2008 8:36 AM EDT

Citi maintains a 'Hold' rating on Bunge Ltd (NYSE: BG), but slashes price target from $130 to $95.

Citi analyst says, "Given what our Citi (Invtmt Research) Emerging Markets Economist team views as the possible beginnings of a potential slowdown within the emerging markets, we believe that the risk of moderating demand growth has increased and thus future earnings at Bunge could come under pressure...Adding to the risk profile surrounding 2009 earnings at Bunge is the recent decline in commodity prices which has been led by crude oil, which is down approximately -25% from its July peaks. At this point we don't know for sure that events will unfold to reduce commodity demand and thus prices, but the signs seem to be forming, as several of our fellow analysts have reduced their price forecast for different commodities such as our commodities strategy analyst who on Monday reduced his forecast on aluminium, copper, and nickel prices by -10% to -27%, due to concerns of a slowdown in industrial activity."

Bunge Limited (Bunge) is an agribusiness and food company operating in the farm-to-consumer food chain. The Company conducts its operations through three divisions: agribusiness, fertilizer and food products.

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