KMTUY - CNH Industrial Undervalued With Strong Ag Demand Likely To Persist
- Strong farm equipment demand and improving construction markets isn't translating into investor demand for machinery stocks, including CNH Industrial.
- Conservative guidance at the recent investor day won't help in the near term, though the ag business looks set for further profitable growth.
- CNH is making meaningful investments into precision ag, automation, and electrification, but likely needs to rethink the Construction equipment portfolio to drive better scale.
- If CNH can generate long-term revenue growth in the mid-single-digits and high single-digit FCF margins, the shares are meaningfully undervalued today.
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CNH Industrial Undervalued With Strong Ag Demand Likely To Persist