Stephen Macleod, an analyst from BMO Capital, has initiated a new Hold rating on Rogers Sugar (RSI).
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Stephen Macleod has given his Hold rating due to a combination of factors related to Rogers Sugar’s recent financial activities and market conditions. The company recently completed a $100 million convertible debenture offering, which will aid in reducing the amount drawn on their Revolving Credit Facility, thus providing flexibility before the maturity of their Seventh Series debentures in 2025. While the 6% yield could appeal to income-focused investors, the overall market performance rating reflects a belief that the current valuation appropriately captures the growth in demand for sweeteners.
Stephen Macleod maintains that while the 2025 forecast for Rogers Sugar shows expected volume growth and stable margins across its Sugar and Maple segments, potential tariff risks could impact these projections. Despite the potential for higher year-over-year EBITDA due to robust North American demand, the target price remains unchanged at $6.50, reflecting the modest estimate revisions. Consequently, the Hold rating suggests that while the company’s fundamentals are solid, the stock’s current price may not offer significant upside potential beyond its income appeal.
According to TipRanks, Macleod is a 5-star analyst with an average return of 11.7% and a 57.50% success rate. Macleod covers the Consumer Cyclical sector, focusing on stocks such as Aritzia, Gildan Activewear, and Dorel Class B.
In another report released on February 7, Scotiabank also maintained a Hold rating on the stock with a C$6.00 price target.