Nufarm: Confidence in its growth strategy builds

About the author:

Belinda Moore
Author name:
By Belinda Moore
Job title:
Senior Analyst
Date posted:
19 May 2023, 8:00 AM
Sectors Covered:
Agriculture, Food & Beverage, Travel and Chemicals

  • Xero (ASX:XRO) reported a good FY23 result that showed it can grow revenue at a healthy rate (+28% YoY) with a combination of subscriber growth (+14% YoY) and higher Average Revenue Per User (ARPU), which was up 8% YoY in constant currency.
  • The highlight was an impressive lift in Free Cash Flow (FCF) to ~NZ$102m. Both Adjusted EBITDA and FCF increased by around NZ$100m over FY23.
  • Under new management, the strategy has moved from reinvesting in growth to a balanced approach to profitable growth and capital allocation. Investors are clearly supportive of this and the share price has rallied ~20% over the last few months.
  • After a strong share price performance, we move to a Hold recommendation.

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