Guru Steven Cohen (Trades, Portfolio), founder of Point72 Asset Management, increased his position in Bunge (BG, Financial) by nearly 1,500% adding 2,717,200 shares to his portfolio in the third quarter. The trade had a 1.13% impact on Cohen’s portfolio; he now owns 2,901,800 shares of Bunge.
Bunge was founded in the Netherlands in 1818 by Johann Peter Gottlieb Bunge as an importing/exporting trading firm. Nearly two centuries later, Bunge is a leading agribusiness and food company with the goal of ensuring sustainable food security for a growing population.
Bunge conducts its business operations in five principal business areas: agribusiness, sugar and bioenergy, edible oil products, milling products and fertilizer.
The company has 35,000 employees in approximately 40 countries.
Bunge has a market cap of $10.22 billion, a price-earnings (P/E) ratio of 16.27, an enterprise value of $15.91 billion, a price-book (P/B) ratio of 1.61 and a quick ratio of 0.82.
According to GuruFocus Bunge has a 6 of 10 financial strength rating with a cash-debt ratio of 0.09, an equity-asset ratio of 0.35, an interest coverage ratio of 4.17 and a Piotroski F-Score of 7 indicating a healthy business situation. The company also has a 5 of 10 profitability and growth rating with an operating margin of 2.58%, a net margin of 1.61%, an ROE of 9.37%, an ROA of 3.47%, an ROC (Joel Greenblatt (Trades, Portfolio)) of 11.21%, EBITDA growth (three years) of 13.20% and EPS Growth (three years) of 24.50%.
Cohen may have decided to add to his position for the following reasons:
- The company is working to solve one of the world’s biggest challenges – how to ensure sustainable food security.
- The company has a Piotroski F-Score of 7, indicating the company is in a healthy business situation.
- The company is expanding its operations which is usually a good sign.
Below is a Peter Lynch chart that shows Bunge is trading above its intrinsic value.
Since Cohen added to his holding, the company’s market price has gained an estimated 18%.
Disclosure:Ă‚ Author does not own any shares of this company.
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