We recently compiled a list of the 7 Best Agriculture Stocks to Buy Right Now. In this article, we are going to take a look at where Bunge Global SA (NYSE:BG) stands against the other agriculture stocks.
Global Agriculture: Trends, Challenges, and Opportunities Ahead
The global agriculture market is currently experiencing significant changes driven by various factors, including population growth, climate change, and technological advancements.
According to a report by The Business Research Company, the global agriculture market was valued at $13.27 trillion in 2023. The market is expected to expand at a compound annual growth rate (CAGR) of 7.7% during 2024-2028 to reach a value of $19.28 trillion by the end of the forecast period. The agriculture market is primarily driven by the increasing demand for food due to a rapidly growing population, which is projected to reach 9.7 billion people by 2050 according to estimates by the United Nations.
Additionally, advancements in technology, such as precision agriculture and automation, are transforming farming practices, allowing for more efficient use of resources and higher crop yields.
The OECD-FAO Agricultural Outlook 2024-2033 highlights significant trends in the global agriculture market. Over the past 20 years, the demand for agricultural products has grown, primarily due to population and income increases in low- and middle-income countries. These nations have also boosted their production by adopting new technologies and better utilizing their natural resources.
Looking ahead, total consumption of agricultural and fisheries products is expected to rise by 1.0% annually over the next decade, mainly in low- and middle-income regions. Global food consumption is projected to increase by 1.2% each year, driven by population growth and rising incomes. Notably, the use of crops for animal feed is anticipated to grow faster than direct food consumption. This shift reflects a trend towards more animal-based diets, leading to increased livestock production.
In middle-income countries, daily calorie intake per person is expected to rise by 7% by 2033, fueled by higher consumption of staple foods, livestock products, and fats. On the other hand, low-income countries will see a modest 4% increase in calorie intake. This slower growth indicates challenges in achieving the Sustainable Development Goal of eliminating hunger by 2030.
High-income countries are also changing their dietary habits, with a slight decrease in fat and sugar intake as people become more health-conscious. Overall, these trends suggest that while there is growth in food consumption globally, disparities remain between different income levels.
Our Methodology
To compile our list of the 7 best agriculture stocks to buy right now, we used the Finviz and Yahoo stock screeners to find the largest agriculture companies. We also reviewed our own rankings and consulted various reports to compile a list of the best agriculture stocks.
From an initial pool of over 20 agriculture stocks, we focused on the stocks that analysts believe possess the greatest potential for growth. Finally, we ranked the 7 best agriculture stocks to buy right now based on their average price target upside potential according to analysts as of November 14, 2024.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Photo by Sebastian Gómez on Unsplash
Bunge Global SA (NYSE:BG)
Average Upside Potential According to Analysts: 23.78%
Bunge Global SA (NYSE:BG) is a global agribusiness and food company that ranks among the best agriculture stocks to buy right now. The company connects farmers to consumers by delivering food, feed, and fuel. Bunge Global SA (NYSE:BG) is a leader in oilseed processing and produces and supplies specialty plant-based oils and fats. The company’s products are used in many applications, including animal feed, cooking oils, bakery items, and infant nutrition. Additionally, Bunge Global SA (NYSE:BG) plays an important role in supporting renewable energy solutions by utilizing its crop infrastructure.
The company is merging with Viterra to create a global agribusiness company. On October 5, 2023, Bunge Global SA (NYSE:BG) announced that its shareholders approved the acquisition of Viterra Limited, a leading marketer and handler of grains and oilseeds with a strategic network of agricultural storage, processing and transport assets.
This merger will enhance Bunge’s (NYSE:BG) capabilities and expand its global reach. The integration planning is progressing well and the company expects to close the transaction in late 2024 or early 2025.
In the third quarter of 2024, Bunge Global SA (NYSE:BG) reported a diluted EPS of $1.56, down from $2.47 in the previous year. Despite solid performances in Agribusiness and Refined and Specialty Oils, the overall results were affected by a challenging global margin environment.
On October 1, 2024, Bunge Global SA (NYSE:BG) announced that it had completed the sale of its 50% stake in BP Bunge Bioenergia to BP, marking a shift towards focusing on core operations while offloading non-essential ventures.
Additionally, in the Q3 2024 earnings call, management shared that Bunge Global SA (NYSE:BG) is expanding its capabilities with the ongoing development of a palm and specialty oils facility in Avondale, Louisiana. This facility, which has multi-oil capabilities, is expected to enhance the company’s ability to serve customers across North America effectively.
Bunge’s (NYSE:BG) strategic initiatives and operational efficiencies position it well for future growth. Analysts currently recommend BG stock as a buy.
Overall, BG ranks 6th on our list of the best agriculture stocks to buy right now. While we acknowledge the potential of BG as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than BG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
