Sell: Adecoagro S.A. (AGRO)
From The National Investor
Updated from Wall Street’s Best Investments 806, June 20, 2018
I’m advocating that you SELL Adecoagro S.A. (AGRO). AGRO continues to languish, despite what in most regards was a good quarter it just announced. Trouble is 1. debt continues to rise for the company despite very strong cash flow. And 2. I’m sure some of this has to do with Argentina’s currency woes specifically and EM weakness overall. Argentina’s currency, though, helps more than it hurts when it comes to paying wages and local bills.
That AGRO couldn’t get much of a bid even this week when there was some rebound in EM’s doesn’t bode well. This is a heart breaker as the underlying story, I believed, was always strong; and probably still is. But the odds are that this could get even weaker still, especially if continued Fed hawkishness takes even more oxygen out of stocks like this. So best to cut and run while our losses are still fairly slight.
Chris Temple, The National Investor, www.nationalinvestor.com, 224-308-2587, August 30, 2018