Corteva

Methodology

Corteva's agricultural seed and crop protection business shows significant earnings cyclicality tied to crop prices, weather, and farmer planting decisions. Multi-year product development cycles and seasonal revenue patterns create volatility requiring normalization. Fair value works best using mid-cycle assumptions for acreage, yields, and farmer purchasing power rather than peak or trough conditions.

Methodology

Corteva typically trades at PEG ratios between 1.0-2.0x, though agricultural cyclicality makes growth rates highly variable year-to-year. The company's seed innovation pipeline and crop protection portfolio support mid-single-digit long-term growth. PEG can mislead when commodity price swings temporarily boost or depress earnings independent of underlying business trends.

Methodology

Corteva pays a dividend yielding 1-2% with growth potential as the business generates substantial free cash flow. The company balances dividends with strategic R&D investment and opportunistic share repurchases. Total return benefits from modest yield component, though growth remains the primary driver as agricultural technology adoption accelerates.