Is Bunge Global (BG) an Undervalued Defensive Stock for 2025?

The global agribusiness landscape has been volatile in recent years, with commodity price fluctuations and oversupply challenges impacting the performance of major players like Bunge Global (BG). As investors seek defensive stocks to weather market uncertainties, the question arises: is BG an undervalued defensive stock for 2025?



Bunge Global, valued at $13.7 billion by market cap, operates as an agribusiness and food company with a strong global presence in over 40 countries. Its vertically integrated supply chain, spanning from raw material sourcing to final product distribution, provides a competitive edge in optimizing efficiency, maintaining quality, and reducing costs. However, the company's stock performance has been lackluster, with shares trading 17.6% below their 52-week high and declining 14.4% over the past 52 weeks.



The primary challenge facing BG is the global oversupply of soybeans and corn, which has driven down prices and led to declining crushing margins. This pressure, coupled with a Q2 earnings miss, has contributed to the stock's underperformance compared to the Dow Jones Industrial Average Index. Despite these headwinds, analysts remain cautiously bullish about BG's prospects, with a consensus rating of "Moderate Buy" and a mean price target of $114.11, suggesting a premium of 20.5% from its current levels.



BG's defensive qualities lie in its diversified business model and global reach. The company's exposure to multiple commodities and markets reduces its vulnerability to price fluctuations in any single segment. Additionally, its strong balance sheet and cash flow generation capabilities provide a solid foundation for navigating market uncertainties.



In conclusion, while Bunge Global faces significant challenges in the form of commodity price volatility and oversupply, its diversified business model, global presence, and strong balance sheet make it an attractive defensive stock for 2025. Although the stock has underperformed in recent months, analysts' positive outlook and the company's fundamentals suggest that BG is undervalued at its current price. As investors seek defensive stocks to weather market uncertainties, BG's defensive qualities and long-term growth potential make it a compelling option for consideration.