Corteva Could See 'Meaningful' Earnings Growth After 2027, KeyBanc Says in Upgrade

02:05 PM EDT, 10/07/2026 (MT Newswires) -- Corteva (CTVA) could see "meaningful" earnings growth after 2027 amid company-specific drivers and a projected recovery in the agricultural cycle, KeyBanc Capital Markets said Wednesday. Last week, Corteva completed the spin-off of its seed and genetics business into Vylor (VYLR), leaving it as a pure-play crop protection company. Corteva said at the time it had an $11 billion crop protection pipeline. Although the company's shares have been volatile since, they offer an "attractive entry point, especially for investors willing to weather the post-spin ebbs and flows," KeyBanc analyst Salvator Tiano said in a note to clients Wednesday. "From (2028), we believe that company-specific drivers and an (agricultural) cycle recovery could lead to meaningful earnings growth." The brokerage upgraded its rating on the Corteva stock to overweight from sector weight, with a price target of $17. The company's shares were up 3.6% in afternoon trade, bringing its year-to-date gains to 43%. "We believe that initial volatility plus selling pressure post-spin warrant a somewhat cautious valuation approach, but longer term, we see an 8x multiple as conservative for such a business," Tiano said in the note. Recent remarks from Corteva and FMC (FMC) indicate continued tougher backdrop ahead for the industry, especially with the price outlook continuing to lag expectations throughout this year, while other indicators point to "no line-of-sight to a recovery" in 2027, KeyBanc said. Corteva has a strong pipeline and biologics portfolio, while sales of new products, additional cost reductions and improving farmer economics could support stronger earnings growth in 2028 and 2029. The brokerage estimates the company will generate adjusted earnings before interest, taxes, depreciation and amortization of $1.65 billion in 2029, at the upper end of management's target range of $1.45 billion to $1.65 billion. KeyBanc also highlighted Corteva's balance sheet, forecasting the company will end 2026 with about $500 million of net cash. That could provide capacity for more than $1.5 billion of additional share repurchases or acquisitions, on top of recurring free cash flow, according to the brokerage. KeyBanc identified continued weakness in the pesticides market as the biggest risk to its thesis, citing limited volume growth and persistent price pressure from generic products. Price: 14.25, Change: +0.34, Percent Change: +2.44