African swine flu ravaged hog population in China which also caused pork prices to skyrocket. The report says that almost 200 million pigs in the country have succumbed to the illness.

Now, analysts from Wall Street are clambering to evaluate the aftermath of the quickly spreading disease and looking for ways to invest over it.

Deere has been lowered to underweight by J.P. Morgan on worries about the rapid deterioration of fundamentals in the United States’ agriculture. Trade war has not only been the reason for this, but also the decreasing soybean demand in China as the outbreak of the African Swine Fever continues to sweep hog herds across the country.

In the previous week, BMO analysts also downgraded restaurant hospitality group Bloomin’ Brands.

Analyst Andrew Strelzik noted that they believe that the possible severity and duration of the consequences of the African Swine Fever is undervalued and stated that BLMN is one of the restaurants at most risk. He further stressed that their estimates for 2020 are under consensus despite their conservative actions to combat the effects of the disease. Impacts on their protein and model pressures are foreseen to linger beyond 2020.

Shares plunged 10% this week. Hormel Foods released earnings last Thursday. Although the firm beat, they gave notice that their sales can be affected by flu issues.

That could go the same way and be a persistent blockage on stock, says Stephens analysts. Ben Bienvenu said that while the outcome on the quarter was relatively higher than expectations, support was fainter than the street impressions, and the management’s talk about African Swine Flu’s precariousness could put pressure on the stock.

Swine flu heat is also impacting food manufacturers like Phibro and Darling Ingredients. Latest analysis has forecasted that almost 30% of swine production can be lost to African Swine Flu and management of Phibro is scared that the estimate can be low, a Gabelli analyst said.

The confirmed number of African Swine Flu cases continues to rise and poses a potential more considerable impact on the operations of Darling’s Ingredients, a Goldman Sachs analyst said. The industry and the management is said to stay wary as preventing more outbreaks of the African Swine Flu remains the highest priority.

This week Philbro was up more than 5% while Darling Ingredient’s share plummeted 3.76%.

These are the stocks that analysts are concerned to be hit by the swine flu:


Stephens on Hormel: Equal-Weight Rating

Stephens said that while the outcome in the quarter for Hormel may be higher than expected, support was lesser on street impressions (although the consensus may be disorganized as some analysts accounted for the CytoSport sake, while the others didn’t) and the management’s talk about the unpredictability of the African Swine Flu puts pressure on the stock. They gave an EW rating, and their forecasts/PT are still under review.


BMO on Bloomin’ Brands: Underperform Rating

BMO said that they are putting BLMN at Underperform and minimizing their target price at $18 is in relation to the consequences of the African Swine Fever. They believe that the potential gravity and duration of the aftermath of the African Swine Flu are underestimated and BLMN is one of the restaurants at most risk. They stressed that their forecast for 2020 is lower than consensus in spite of their conservative attack to fight the effects of the illness. Impact on their protein and model pressures are forecasted to persist even after 2020.


J.P. Morgan on Deere: Underweight Rating

J.P..Morgan downgraded Deere to Underweight due to the quick collapse of the basics of US agriculture. Apart from tariffs, demand for soybean from China is poised to decline considerably due to the 30% loss in its hog herd brought by the African Swine Fever outbreak. Argentina and Brazil combined have generated near records of corn crops and soybean this season. On the other hand, US dollar dominancy stays as US main advantage in the global market.


Gabelli on Phinro: Buy rating

Revenues in the Asia Pacific were substantial in the third quarter, but, the consequence of the African Swine Fever is yet to hit. Estimates show that the illness swept 30% of Chinese pigs. Phibro’s fear that this impression is low. With this, the firm is readjusting its expectations for the last quarter and the entire year of animal health is also forecasted to go flat-to-down.


Golden Sachs on Darling Ingredients: Neutral Rating

With the continuous rise of the African Swine Fever cases, it poses a more substantial impact on Darling Ingredient’s operations. The industry and their management are prioritizing looking for ways to prevent future outbreaks of the disease. The decrease in hog supply negatively impacts the food business. Darling Ingredients noted higher expenses in Europe. While they have enough supply for the second quarter, they are posed to have a pressured third quarter.