DPM [OUTPERFORM +13.1%] - Urea price rally to outweigh higher input costs in 2021 - Update
  • 2021-05-12T20:12:55
  • Company Research
We trim our target price by ~4% as we cut 2021F/2022F NPAT-MI by 8.2%/6.5% following our lower projected profit from the NH3-NPK plant despite a 50-bp reduction in our cost of equity. We upgrade our rating from MARKET PERFORM to OUTPERFORM as DPM’s share price declined ~11% last month. We believe DPM is a robust dividend play given its strong financial capacity and solid earnings outlook. We expect 2021F EPS growth of 20.2% YoY, driven by 1) an 11.0% YoY rise in urea prices outweighing