The shares imply about 20 times 2026 operating EBITDA. I model $3.05 billion of 2027 EBITDA and 15 times, which is a $62 stock.
Key points
- $2.8 billion is management’s 2026 operating EBITDA, about 20 times today’s enterprise value.
- $3.05 billion is my 2027 EBITDA, a 9% step-up on 3, 4% sales growth and royalty neutrality.
- 15 times that EBITDA, after $4.5 billion of net debt, is $62 a share.
The call
The $77 price requires nearly 20 times 2026 operating EBITDA of $2.8 billion, or about 18 times a 2027 figure near $3.0 billion. That is a compounder multiple on a 3, 4% sales business with a stayed injunction and no buybacks.
I model $3.05 billion of 2027 EBITDA and a 15 times multiple. Hybrid wheat and royalty income help, but farmer margins stay tight and the Indiana case caps capital returns. The market is too optimistic.
Seed operating EBITDA ($ millions)Predecessor seed segment, company releases through July 30, 2026; 2026-27E are mine
Valuation
| Item | Figure |
|---|
| 2027 operating EBITDA (mine) | $3.05 billion |
| Multiple | 15 times |
| Enterprise value | $45.8 billion |
| Net debt (notes plus revolvers, less $1.1 billion cash) | $4.5 billion |
| Equity value / shares | $41.2 billion / 667 million |
| 12-month target | $62 |
Fifteen times sits between crop-science history and a genetics story. Asymmetry is poor: a $15 miss if I am right versus a $15, 20 loss if the multiple holds. That is a sell, not a hold.
Risks
- Seventh Circuit lifts the stay and blocks ordinary asset moves; watch the docket.
- 2027 North America corn acres fall more than 2 million; watch USDA plantings.
- Royalty income stays negative past 2026; watch the November 11 print.
What would change my mind
A clean appellate win plus 2027 EBITDA guided above $3.3 billion.