Bunge is -2.5% in Wednesday's trading to its lowest since October 2022, after reporting better than expected Q4 adjusted earnings but also issuing a disappointing forecast for 2024.
The world's largest oilseed processor said Q4 earnings from its core agribusiness division jumped 89% Y/Y to $835M, as strong oilseed processing returns in South America, Europe and Canada offset a weaker quarter for processing in the U.S.
Bunge said it expects adjusted earnings will drop by a third this year to ~$9/share, which would be the lowest full-year EPS in four years and lag well behind the $10.42/share analyst consensus estimate, with margins in nearly all regions of the world likely to tighten throughout the year due to plentiful crop supplies and expanded crush capacity.
The forecast does not include the pending Viterra acquisition, which Bunge is aiming to close by mid-year.
Farmers are reluctant to sell and consumers have an incentive to wait as forward prices are now lower than spot prices, CEO Greg Heckman said in the company's post-earnings conference call, adding that "prices are balancing and the supply chain is not quite as tight."
Bunge's 2024 profits nevertheless should remain well above levels seen in years prior to the recent boom, and the company has been historically conservative with guidance, Stephens analyst Ben Bienvenu said, expecting the same outperformance this year.