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Valmont's (VMI) Valley Irrigation Forms JV With Kusto Group

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Valmont Industries, Inc.’s (VMI - Free Report) Valley Irrigation unit announced its joint venture with private holding company, Kusto Group. This multi-year strategic project is geared for the establishment of sustainable agriculture in Central Asia through an agreement with Government of Kazakhstan.

This project aims to improve sustainability and resource conservation, introduce local farmers to the utility of advanced farm technology as well as serve as the base for making the country an agricultural hub in Central Asia.

The government of Kazakhstan is turning to Valley Irrigation for the implementation of precision agricultural practices and cutting-edge farming technologies which are not only sustainable but also generate better yields with fewer resources.

The joint venture will help Kazakhstan unlock its potential in agriculture. Moreover, Valley Irrigation’s 75 years experience will facilitate the farmers to create sustainable incomes and jobs. It will also help the government fulfil its mission of making Kazakhstan the food provider of the world.

The collaboration is registered within the Astana International Financial Centre. It commits to the construction of a plant in Kazakhstan for the manufacture of Valley pivots and a volume guarantee from the government of 4,000 machines. The plant is expected to have an annual production capacity of at least 1,000 pivot irrigation machines.

Shares of Valmont have gained 39.9% in the past year compared with 7.8% decline of the industry.

Valmont, in its last earnings call, stated that it expects net sales of $715-735 million for fourth-quarter 2020. It also expects operating profit margins of 6.5-7.5% for the fourth quarter. Valmont anticipates revenues from the Irrigation segment to increase around 12-15% year over year for the said quarter.


Zacks Rank & Key Picks

Valmont currently carries a Zacks Rank #4 (Sell).

Some better-ranked stocks in the basic materials space are Fortescue Metals Group Limited (FSUGY - Free Report) , BHP Group (BHP - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .

Fortescue has a projected earnings growth rate of 73.5% for the current fiscal. The company’s shares have surged around 157.3% in a year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

BHP has an expected earnings growth rate of 49.16% for the current fiscal. The company’s shares have gained around 29% in the past year. It currently flaunts a Zacks Rank #1.

Impala has an expected earnings growth rate of 131.7% for the current fiscal. The company’s shares have surged around 40.6% in the past year. It currently sports a Zacks Rank #1.

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