Citigroup has updated its rating for Koor Industries Ltd. (NYSE: KOR; TASE: KOR) subsidiary Makhteshim Agan Industries Ltd. (TASE: MAIN) following the publication by the latter of its results for the first quarter of 2007. The bank has rated Makhteshim "Buy" with a target price of NIS 32.
Citigroup notes Makhteshim's adjusted earnings per share which came in at $0.16, an increase of 20%, driven by volume growth. "Currencies added an estimated 5% to sales. Prices were slightly lower, but a reduction in raw material costs and measures to contain fixed cost growth led to the improved result," it says.
As for the first quarter sales, Citigroup says, "The sales growth of 13% was driven by strong growth in Europe (up 17% and about 9% underlying) and in Brazil (up a reported 26%). Sales rose by 2% in the US. This was partly due to the poor weather and a reflection of intense competition in this market."
Citigroup says its recommendation is based on its expectation that Makhteshim will maintain its recovery potential. "The company is well positioned strategically," it concludes.
Published by Globes [online], Israel business news - www.globes.co.il - on May 14, 2007
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