The case for ELDERS

The case for Elders

1) They have significant tax credits to use up. Allowing future tax free growth and fully franked dividends.

2) The AUD has fallen against the USD. As the AUD falls it becomes more profitable to sell abroad. Farming naturally benefits.

3) The price of oil has come down. (A significant of the cost of farming)

4) Elders has entered the ASX200 and tracker funds and other ETFs will need to buy if they track the ASX200.

5) Lending should become cheaper for Elders as it is now an ASX200 company. ie less risky loans and better access to capital.

6) As farmers get older (58.3 years average in 2014) they need to sell for their retirement. Elders is there to buy the best assets. Any profits from these consolidated farms result in an increase share price x the current PE of 12.

It has been said that the people who get rich in a gold rush, are the people who sell the spades and shovels to the hopeful. Elders supplies farmers. If you believe that the world populations will rise to 10 billion and those billions will want to eat caloric intensive meat, from non polluted land. Then the gold rush may just be getting started.