Lehman Brothers today raised its target price for Israel Chemicals Ltd. (TASE: CHIM) to NIS 50 from NIS 40, while reiterating its “Outperform” recommendation. Yesterday, Bank Hapoalim raised its target price for the company to NIS 45 from NIS 38, while reiterating its “Buy” recommendation.
Both banks cited rising global potash prices for the updates. Bank Hapoalim analyst Gilad Sarig cites reports that the price for potash has already reached $360 per ton in Asia. “Potash prices are reaching levels that industry veterans never dreamed of two years ago,” he writes.
Sarig based his target price of NIS 45 on a p/e ratio of 18 for Israel Chemicals in 2008. As for the share’s 60% rise since January and 160% rise over the past two years, he says, “The momentum will continue, although there might be profit taking on the way.”
Lehman Brothers predicts that prices for both potash and phosphates will continue to rise during 2008. The bank predicts a double-digit rise in prices, although the rate will be slower than in 2007.
Published by Globes [online], Israel business news - www.globes.co.il - on October 18, 2007
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