Consumer Sector Update for 09/12/2017: BG,ROST,LMNR

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Consumer stocks were posting moderate gains this afternoon, with shares of consumer staples companies in the S&P 500 slipping to a 0.1% increase while shares of consumer discretionary firms in the S&P 500 were hanging on for a nearly 0.5% advance.

In company news, Bunge Ltd ( BG ) declined Tuesday, with shares of the agribusiness and food processing company falling almost 8% at one point and touching a session low of $69.94 each, after the company said it was acquiring a 70% equity stake in a producer of palm oil and other tropical oil-derived products for $946 million.

Bunge said the deal for IOI Loders Croklaan, currently a subsidiary of Maylasia's second-largest publicly owned palm-oil producer, IOI Corp., will immediately add to its cash earnings during the first 12 months after closing. It sees Loders generating around $105 million in earnings before interest, taxes, depreciation and amortization during 2018, with GAAP earnings growing by 5% and 7%, respectively, over current projections during years two and three.

In a related move, the company said it would likely fund the transaction with proceeds from a new, $900 million, unsecured, delayed-draw credit facility maturing in September 2020 with Sumitomo Mitsui Banking Corp.

Also, analysts at Robert W. Baird & Co. began coverage of Bunge stock with a Neutral rating and a $77 price target.

In other sector news,

(+) ROST, (+3.0%) Bernstein begins analyst coverage with Outperform rating and a $74 price target.

(-) LMNR, (-7.1%) Reiterates FY17 net income of $0.51 to $0.55 per share, trailing the analyst consensus by at least $0.05 per share. Also reports fiscal Q3 EPS of $0.52, down from $0.71 per share in year-ago levels but still matching Street views. Sales rise 1.2% to $40.4 mln, topping the $37.9 mln consensus.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Business , Commodities
Referenced Symbols: BG , ROST , LMNR

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