AGCO Corporation’s (AGCO) adjusted first quarter EPS of $0.81 was almost seven times that of the year-ago quarter, driven by sales growth across all segments and improved gross margins. For fiscal 2011, AGCO expects EPS between $3.50 and $3.75. Global industry sales are anticipated to grow in 2011.
With a full product line of farm equipment and a wide network of dealers and distributors, we believe AGCO is well positioned over the long-term to capitalize on the need for increased food production, which is being driven by worldwide population growth. Moreover, the company is also looking to expand operations in high-growth emerging markets, which bode well for future operating performance.
Over the last five years, the company’s shares have traded in the range of 4.2 to 36.4 trailing 12-month earnings. We maintain our Outperform recommendation with a target price of $68.00, based on 20.0x P/E to our fiscal 2011 earnings estimate.
AGCO CORP (AGCO): Free Stock Analysis Report
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