Brasil Foods (
BRFS
,
quote
) CEO José Antonio Fay sees high grain prices for "at least"
the next two years, peaking in the next two months before
Christmas.
[caption id="attachment_73548" align="alignright" width="300"
caption="Dinner is looking more expensive"]
[/caption]
Featured on
Trading The Globe
last Friday, Brasil Foods
is the largest poultry exporter in the world, a member of CNBC's
Ambassador's Index that spotlights tomorrow's companies today, and
arguably the Tyson Foods of Brazil.
The company has a presence in over 110 countries, with
offices in the Middle East, Asia, and Europe, with 42
factories, 120,000 employees, four industrial plants
worldwide and 60 in Brazil, 36 distribution centers
and 24 global offices, making it the tenth largest food
company in the world.
Brasil Foods core business is chilled and frozen food. It
processes frozen pastas, soybeans, and their derivatives, and
distributes frozen vegetables.
Ceo Antonio Fay has "some targets" for acquisitions he said to
Bloomberg in a phone interview from London, and expects margins to
improve in the fourth quarter on the price rises. The CEO also
expects the company's net debt to fall to two times Ebitda in
2013.
Brasil Foods is already set to invest $130 million to build a
plant in Abu Dhabi, which is scheduled to start operations in the
fourth quarter of 2013, when it will produce 60,000 tons per year
of processed food.
Trading The Globe: The Tyson Foods of Brazil?
Emerging Money talked about how
rising grain prices were making Brasil Foods
attractive
in July, although subsequent discussion saw the
company's prospects as mixed
.
Analysts polled by Thomson Reuters have
downgraded their estimates concerning earnings per share
(check the link for charts), reports 4-Traders.com:
"Technically, the security could run out of steam close to the
BRL 37.2 resistance. Indeed, the stock is moving in an upward trend
in the short term but it could know a halt. In this context, the
downward movement could improve and it should expect a return to
BRL 32.4. Indicators that show an overbought situation confirm this
scenario.
"The technical configuration and fundamentals lead us to predict
a consolidation phase, at least in the short term. The BRL 37.2
should play its full role and to stop the upward trend initiated in
the short term. Therefore, to take advantage of this technical
correction, a short position may be opened in the current area to
target BRL 32.4. In case of further acceleration, the stop loss
will be triggered above the BRL 37.2."
