Citi Starts Corteva Inc. (CTVA) at Buy, Opens 30-Day Upside Catalyst Watch

Citi analyst Patrick Cunningham initiates coverage on Corteva Inc. (NYSE: CTVA) with a Buy rating and a price target of $68.00.

The analyst comments "We initiate on CTVA with a Buy rating and a $68 target price. The last 2 years have seen challenges in the Ag industry with global stocks-to-use moving up and continued downward pressure on grain prices. CTVA has maintained solid performance in its Seeds business, while the crop protection market has seen massive destocking across the major growing regions. Even in a challenging Ag macro, we believe CTVA has a solid glidepath to meaningful EBITDA expansion in 2025 and beyond based on the following factors: 1) tailwinds from continued cost savings and productivity in 2024-2025 totaling $350-$450 mm per annum; 2) net royalty expenses flip to net royalty income with longer-dated upside beyond Enlist E3; and 3) technologically advantaged Seeds business with long-term upside from gene-editing & acreage needs plus a solid CP pipeline. We initiate a 30-day positive catalyst watch ahead of 3Q24 earnings and November Investor Day. We expect guidance on cost deflation (particularly Seed as hedges roll off) and productivity to be meaningful tailwinds and any incremental confidence in CP market recovery will be viewed favorably. At the Nov 19 investor Day, we also expect the management to size the long-term opportunities and provide more insights into the synthetics pipeline, biologicals, biofuels, and gene-editing, which should help level set the medium-to-long-term earnings power."

For an analyst ratings summary and ratings history on Corteva Inc. click here. For more ratings news on Corteva Inc. click here.

Shares of Corteva Inc. closed at $59.12 yesterday.

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