Is Corteva Stock a Buy Right Now?
The stock of agriscience company Corteva (NYSE: CTVA) is a battleground. Actually, it's a near-term battle on two fronts. Not only is there debate around the company's ability to meet its earnings targets, but there's also a concerted attempt by activist hedge fund Starboard Value to change the management of the company. That said, the long-term prospects look very good, but are the long-term prospects for this company worth overlooking these short-term fights? Let's take a closer look.
Corteva is a company created out of the DowDuPont merger. DuPont's agribusiness generated 70% of its revenue from seeds, with crop protection products making up the rest. Meanwhile, the Dow business was 80% crop protection and 20% seeds and traits. Put together, the Corteva business is 55% seeds and traits and 45% crop protection.
The case for the stock is based on the idea that significant structural cost savings (closing manufacturing plants and rationalizing the supply chain) can be generated by the merger, alongside productivity enhancements such as improving IT systems.
Source Fool.com
