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Mar 4 2019, 07:00 GMT
Key debates around Origin’s equity are evolving, with the focus now on farm subsidy changes, supply chain and technology adoption at farm-gate. Despite the rate of change, we believe the role of the distributor will not be disintermediated, with on-farm relationships and the role of the trusted advisor remaining critical in a more commercial farming environment. Following a period of investment, the next stage of Origin’s evolution will be about enhancing productivity and delivering sustainable growth. Trading on 10.5x forward P/E and 7.7% free cash flow yield, Origin is unfairly priced for imperfection. With upside risk to forecasts, we reiterate our ‘Outperform’ rating.