Lower earnings visibility likely for Farm Fresh

Farm Fresh chief operating officer Azmi Zainal (pink shirt) taking the MBSJ delegation on a tour of the dairy farm.

PETALING JAYA: The higher-than-expected milk farm gate prices for the new season is a negative surprise for Farm Fresh Bhd, which points to a tougher recovery path ahead, according to RHB Research.

With the setback, the research house has turned more conservative with its valuation taking into account the group’s weaknesses in earnings visibility and consistency.“There are minimal earnings downside risks moving forward and the heavy selldown about 29% year-to-date may have largely priced in the weakness,” RHB Research said in a note to clients yesterday.