Noble Group up as brokers raise target prices

Shares of Noble Group rose as much as 2.8% after analysts raised their target prices for the
commodity trader on expectations of an earnings improvement.

By 10:52 a.m., Noble shares were up 2.4% at $1.295, and have climbed 14.6% so far this year, compared to the Straits Times Index’s 15% rise.

CIMB Research raised its target price for Noble to $1.61 from $1.46 and kept its ’outperform’ rating, and said its new sugar assets in Brazil should boost agriculture earnings and on
improving industry outlook.

With sugar harvesting peaking in the third quarter, Noble could post near-record profits for the quarter, CIMB said.

It noted that agriculture businesses have recovered from a bout of dismal earnings with industry profits rebounding, and the U.S. drought has created opportunities for supply chain managers that are able to procure supplies amid crop scarcity and deliver grains where they are needed.

DBS Vickers also raised its target price for Noble to $1.60 from $1.30, and raised its 2012-2014 profit estimates by 10-12%, given the expansion into higher margin metals trading and prospects of an improving Chinese economy next year.

Noble will report its third-quarter results on Nov. 8.