Why Bunge Limited's Shares Dropped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of ag company Bunge Limited (NYSE: BG  ) fell 10% today, after the company released earnings.

So what: The company's revenue rose 9%, to $17.0 billion, but analysts had set their sights on $18.69 billion. To make matters worse, the company reported a $610 million loss when you include a $683 million one-time charge. Even if you take out the charge, the adjusted earnings per share of $0.57 was well short of the $2.36 analysts expected.  

Now what: A big loss at the company's risk management division was blamed for most of the disappointment, and the company sees this as a one-time event. CEO Alberto Weisser also said he will step down as of June 1 after 14 years on the job. This was a disappointing quarter for the company, but with the need for food only growing, and shares now trading at nine time forward earnings, I think this is a buying opportunity for investors.

Interested in more info on Bunge Limited? Add it to your watchlist by clicking here.


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