February 10, 2011

Acquisition of Danisco to boost Dupont's stocks in agricultural boom

US chemicals group Dupont's shares are likely to be one of the best ways for investors to profit from the agricultural stocks boom, according to business news.

One-third of Dupont's revenue is expected to come from seeds and other agricultural products if Danisco shareholders approve its recent US$6.3-billion bid for the Danish food producer.

Analysts project that next year onward, the deal should add to Dupont's earnings, increasing long-term profit growth by two percentage points to between 13% and 14% per year, Barron's said

Dupont shares are cheaper on a price-expected earnings ratio basis than those of fertiliser maker Potash Corp of Saskatchewan and biotech company Monsanto.