玛弗瑞格（MRFG3）：合并肉类品牌

2024A144,152.0164,147.813,642.013,326.413,080.113,089.22.85 2025E2026E2027E168,114.3172,858.812,638.712,983.312,377.613,058.6(0.51)(1.42)(0.67) Scott Marks * | Equity Analyst+1 (212) 778-8007 | smarks1@jefferies.comNatasha Baker * | Equity Associate+1 (212) 778-8278 | nbaker@jefferies.com The Long View: MarfrigInvestment Thesis / Where We DifferDespite being in the lower end of the NA beef profitability cycle, we findthe current NA operating environment as temporary (and trough), while wecontinue to find export potential, as well as synergistic and deleverage upsidearound BRF, attractive, as well as valuation.Base Case,R$32, +28%•2025 revenues of R$162bn and an ~8% EBITDAmargin.•Merger of MRFG and BRF is approved•~6.5x multiple applied to our two-year forwardEBITDA forecast implies R$32 price target.Sustainability MattersTop Material Issue(s): 1) Water & Wastewater Management:agricultural producers that can committo managing water-related risks through capital expenditure, streamlining operations, and formingpartnerships with communities are better positioned to have lower operational costs and less susceptibleto water shortages and its risks.2) Materials Sourcing & Efficiency:ingredient sourcing that relies leaston resource-intensive commodities allows agricultural producers to adapt to climate change scarcityrisks, protecting them from volatility in feed prices and disruFptions in beef supplies.Company Target(s): 1)Attaining total traceability of the Marfrig supply chain in the Amazon region by2025 and suppliers in the Cerrado and other biomes by 20232)Reduce Scope 1 &2 GHG emissions by68% and Scope 3 by 33% (vs. 2019)Qs to Mgmt: 1)How have you partnered with regulators to ensure that your indirect suppliers comply withlocal environmental laws?2)How are you engaging with ranchers in water conservation and resiliencemeasures?ESG Sector Deep Dive:Processed FoodsPlease see important disclosure information on pages 5 - 10 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Upside Scenario,R$36, +44%•2025 revenues of R$165bn and an~8.3%EBITDA margin.•Merger of MRFG and BRF is approved•~6.8x multiple applied to our two-year forwardEBITDA forecast implies R$36 price target. Downside Scenario,R$20, -20%•2025 revenues of R$158bn and a~7.8%EBITDA margin.•Merger of MRFG and BRF is blocked•~5.8x multiple applied to our two-year forwardEBITDA forecast implies R$20 price target.Catalysts•US cattle herd size fluctuations and impact oncattle price•US/globalrecessionconsumption share between beef, pork, andpoultry•Brazil/South America economic developments•Pork supply normalization and demandrecovery in China impactonprotein2 Figure 1 - Beef cutout now ~$350, above end of '24 average levels.$0$50$100$150$200$250$300$350$400$450$500Aug-19Oct-19Dec-19Feb-20Apr-20Jun-20Beef CutoutSource: Jefferies Research, USDAFigure 2 - The cutout-to-cattle spread back to positive y/y on average over the last 6 weeks.(25%)(20%)(15%)(10%)(5%)0%5%10%15%20%25%30%Jan-24Feb-24Mar-24Source: Jefferies Research, USDAPlease see important disclosure information on pages 5 - 10 of this report.This report is intended for Jefferies clients only. Unauthorized distribution is prohibited. Company DescriptionMarfrigMarfrig Global Foods is the world’s largest beef patty producer. The company is domiciled in Brazil, but North America represents ~70% of totalcompany annual revenue and ~80% of annual EBITDA.Company Valuation/RisksMarfrigOur price target is based on an EV/EBITDA multiple applied to our two-year forward EBITDA forecast. Downside risks include: Potential lost revenueowing to plant closures related to COVID-19, negative COVID-19 implications on global economy, raw material cost inflation, consumption shareloss to competing proteins, increased competition in the company's key US or China markets, South America general economic/political uncertainty,United States Cattlemen's Association's request for investigation into US beef industry players.Analyst Certification:I, Scott Marks, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subjectcompany(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressedin this research report.I, Natasha Baker, certify that all of the views expressed in this research report accurately reflect my personal views about the subject security(ies) and subjectcompany(ies). I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressedin this research report.As is the case with all Jefferies employees, the analyst(s) responsible for the coverage of the financial instruments discussed in this report receivescompensation based in part on the overall performance of the firm, including investment ba