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1. Company Snapshot

1.a. Company Description

CHS Inc., an integrated agricultural company, provides grains, foods, and energy resources to businesses and consumers in North America, South America, Europe, the Middle East, Africa, and the Asia Pacific.The company operates through four segments: Energy, Ag, Nitrogen Production, and Foods.It is involved in the operation of petroleum refineries and pipelines; supply, marketing, and distribution of refined fuels, including gasoline, diesel fuel, and other energy products; blending, sale, and distribution of lubricants; and the supply of propane and other natural gas liquids.


The company also processes and sells crude oil into refined petroleum products under the Cenex brand name to member cooperatives and other independent retailers through a network of approximately 1,500 sites; and provides transportation services.In addition, it markets grains and oilseeds; and offers seeds, crop nutrients, crop protection products, animal feed, animal health products, refined and renewable fuels, and propane, as well as refined oils, meal, soy flour, and processed sunflower products.Further, the company produces and sells nitrogen-based products, including methanol, UAN and urea, and related products; manufactures, packages, and distributes vegetable oil-based products, such as packaged oils, margarine, mayonnaise, flavored dressings, sauces, and other food products; and offers cooperatives with various loans that meet commercial agriculture needs and loans to individual producers, as well as consulting and commodity risk management services.


CHS Inc.was incorporated in 1936 and is headquartered in Inver Grove Heights, Minnesota.

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1.b. Last Insights on CHSCP

CHS Inc.'s recent performance was negatively impacted by unfavorable market conditions and declining earnings. A critical survey comparing CHS to Cadiz highlighted the companies' differing strengths in earnings, profitability, and valuation. CHS's earnings and valuation have been scrutinized, with analysts evaluating the company's position within the consumer staples sector. Moreover, the absence of recent positive developments, such as new product launches or strategic acquisitions, may have contributed to the negative sentiment surrounding the company's short-term prospects.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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CHS (NASDAQ:CHSCP) & Local Bounti (NYSE:LOCL) Head to Head Review

Nov -22

Source: defenseworld.net

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Cadiz (NASDAQ:CDZI) and CHS (NASDAQ:CHSCP) Critical Survey

Nov -19

Source: defenseworld.net

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Coherus Presents Preliminary Results from Phase I Dose Escalation Study of its Anti-chemokine receptor 8 (CCR8) Antibody, CHS-114, at the 2024 American Society of Clinical Oncology (ASCO) Annual Meeting

May -23

Source: globenewswire.com

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7 Ultra-Safe Dividend Stocks to Buy With Yields Over 5%

May -01

Source: investorplace.com

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CHS Reports Third Quarter Earnings

Jul -13

Source: prnewswire.com

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Olive Garden parent Darden stands by outlook after mixed quarterly results

Sep -22

Source: CNBC

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CHS expands soybean oil refining capacity at Mankato processing plant

Sep -07

Source: PRNewsWire

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CHS Expands E15 Fuel Access In 19 Additional Fuel Terminals

Aug -02

Source: Benzinga

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.50%)

6. Segments

Ag

Expected Growth: 4.5%

Growing demand for crop nutrients and seeds, increasing adoption of precision agriculture, and expanding farmer-owned cooperative network drive growth in the Ag segment of CHS Inc.

Energy

Expected Growth: 4.5%

Growing demand for biofuels, increasing adoption of precision agriculture, and rising energy needs in rural areas drive growth in CHS Inc.'s energy products and services segment.

Corporate & Other

Expected Growth: 3.5%

The Corporate & Other segment of CHS Inc. is expected to grow steadily, driven by the company's strategic investments in digital transformation, cost savings initiatives, and optimization of its headquarters operations.

7. Detailed Products

Agricultural Inputs

CHS Inc. provides a range of agricultural inputs including seeds, fertilizers, and crop protection products to farmers and ranchers.

Grain Marketing

CHS Inc. offers grain marketing services, enabling farmers to sell their grains to a global market.

Energy Products

CHS Inc. supplies energy products such as diesel fuel, gasoline, and propane to farmers, ranchers, and other customers.

Livestock Feed

CHS Inc. manufactures and distributes livestock feed products, including feed for cattle, poultry, and swine.

Farm Supplies

CHS Inc. offers a range of farm supplies, including equipment, tools, and hardware.

Financial Services

CHS Inc. provides financial services, including loans, credit, and insurance products, to farmers, ranchers, and other customers.

8. CHS Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

CHS Inc. operates in the agricultural industry, where substitutes are limited. However, the company faces some threat from alternative products and services.

Bargaining Power Of Customers

CHS Inc. has a diverse customer base, which reduces the bargaining power of individual customers. Additionally, the company's products and services are essential to its customers, giving it an upper hand in negotiations.

Bargaining Power Of Suppliers

CHS Inc. relies on a few large suppliers for its inputs, giving them some bargaining power. However, the company's size and scale of operations also give it some negotiating power.

Threat Of New Entrants

The agricultural industry has high barriers to entry, including significant capital requirements and regulatory hurdles. This makes it difficult for new entrants to challenge CHS Inc.'s position.

Intensity Of Rivalry

The agricultural industry is highly competitive, with many players competing for market share. CHS Inc. faces intense rivalry from other companies, which can lead to pricing pressure and reduced margins.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 18.64%
Debt Cost 3.95%
Equity Weight 81.36%
Equity Cost 3.95%
WACC 3.95%
Leverage 22.92%

11. Quality Control: CHS Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Cal-Maine Foods

A-Score: 7.9/10

Value: 8.1

Growth: 9.4

Quality: 8.1

Yield: 10.0

Momentum: 6.5

Volatility: 5.3

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Village Super Market

A-Score: 6.7/10

Value: 7.4

Growth: 4.9

Quality: 4.7

Yield: 7.0

Momentum: 8.5

Volatility: 7.7

1-Year Total Return ->

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CHS

A-Score: 6.2/10

Value: 6.2

Growth: 3.7

Quality: 3.6

Yield: 10.0

Momentum: 3.5

Volatility: 10.0

1-Year Total Return ->

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Limoneira

A-Score: 4.9/10

Value: 8.4

Growth: 6.0

Quality: 4.9

Yield: 4.0

Momentum: 0.0

Volatility: 6.3

1-Year Total Return ->

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Vital Farms

A-Score: 4.9/10

Value: 4.5

Growth: 9.6

Quality: 6.6

Yield: 0.0

Momentum: 5.0

Volatility: 3.7

1-Year Total Return ->

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Alico

A-Score: 4.5/10

Value: 5.0

Growth: 0.9

Quality: 2.0

Yield: 3.0

Momentum: 8.0

Volatility: 8.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

27.7$

Current Price

27.7$

Potential

-0.00%

Expected Cash-Flows