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Feronia Inc FRNFF

Feronia Inc is involved in palm oil and kernel oil business operation. It is engaged in producing and processing palm oil and kernel oil in the Democratic Republic of Congo. The company derives key revenue from the crude palm oil production.


GREY:FRNFF - Post by User

Bullboard Posts
Post by retsinaon Feb 07, 2011 10:28am
522 Views
Post# 18086297

$1.40 target price

$1.40 target priceI just got in this morning on this one... Wellington West targets $1.40.
Initiating coverage: Feronia Inc. (FRN-V) : 100,000 ha Brownfield Palm Oil Producer Trading at a Fraction of the Peer Group 
Analyst: Greg Colman
Palm oil fundamentals appear poised for continued price strength. 
Indonesia and Malaysia produce 91% of the world's palm oil and their supply is flatlining (p.1) while demand is continuing to rise (p.2&3). 
FRN's brownfields start-up is trading at a fraction of the peers ... 
Peers trade at 9.2x EV/EBITDA and $32,177 EV/ha. FRN's brownfields plantation is currently valued at 4.7x EV/EBITDA and $6,806 EV/ha. 
… and has a call option on arable land. 
Our forecasts give minimal value to emerging corporate farm that could, if successful, generate $1,500/ha yearly cash flow per $3,100/ha invested.
Initiating coverage with a Speculative Buy, C$1.40 target price. 
Target is based on 10.9x 2012E EV/EBITDA or $16,150 EV/ha; could migrate to C$2.50-C$3.00 if and as FRN re-rates to peer multiples. 

Bullboard Posts