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2015 All-Latin America Research Team: Agribusiness, No. 2: Giovana Araújo & team

< The 2015 Latin America Research TeamGiovana Araújo & teamItaú BBAFirst-place appearances: 1

Total appearances: 7

Team debut: 2009

Advancing from third place to second is the Itaú BBA squad under the stewardship of Giovana Araújo. The two São Paulo–based researchers “do thorough research on the companies under coverage,” attests one client. “They are always available for conference calls and are very helpful with their analytical insights.” Araújo and her colleague report on eight Latin American agribusiness companies and are generally positive on the sector, at least for the medium term. “We see upside risks coming from an upward trend in global sugar prices and from higher ethanol prices following a possible rise in gasoline prices in Brazil,” says Araújo, 41. Regarding the farming space, in particular, “we see short-term challenges coming from weak global prices due to record crops in U.S. and Brazil,” she adds, while sugar prices could improve “beginning in the second half of 2015, following a shift from surplus to deficit in the global market and strong import demand from China.” On the ethanol side, the analysts anticipate that already robust consumption growth will continue to strengthen. Accordingly, over a 12-month horizon, they recommend that investors favor Brazil’s São Martinho, which produces ethanol and sugar; and Adecoagro, a Luxembourg-based agricultural company with diverse operations in Argentina, Brazil and Uruguay. São Martinho’s stock was trading at 36.62 reais in mid-July, and they forecast a rise to 48 reais. The New York Stock Exchange–listed shares of Adecoagro earn a price objective of $11, which represents an 18.9 percent premium to their value in mid-July. “Giovana and her team provide very accurate and timely industry analysis — for example, different commodities’ relative prices, trends, impact on producers’ margins in the short and medium terms,” observes a second buy-side backer. “On top of that they organize insightful events with top executives."

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