Are Graincorp and PLS shares buys, holds, or sells?

The team at Morgans has been busy running the rule over a number of ASX 200 shares this week following the release of updates.

Let’s see whether the two listed below have been given buy, hold, or sell ratings this week. Here’s what the broker is saying about them:

Graincorp Ltd (ASX: GNC)

Morgans was disappointed with this grain exporter’s guidance update. It highlights that its earnings guidance was significantly weaker than expected due to margin pressures. Unfortunately, the broker feels that these pressures are likely to remain in FY 2027.

However, due to recent share price weakness and its strategic assets, the broker has retained its accumulate rating with a reduced price target of $6.76 (from $9.05). It said:

GNC provided guidance ahead of its AGM on 18 February. Despite a large east coast winter grain crop, GNC continues to disappoint with FY26 earnings guidance materially below consensus expectations. While its volume guidance is unchanged, margins have weakened given the grain trading environment has deteriorated further. Importantly, its balance sheet remains strong. We have made material revisions to our forecasts. The difficult margin environment is likely to also affect FY27 earnings.

With payments to the insurer no longer required in big crop years, GNC’s fixed cost leverage should return when crop production issues around the world ultimately eventuate and global grain stocks tighten. However, we have now taken a much more conservative view on GNC’s ‘through-the-cycle’ EBITDA moving forward. GNC’s strategic assets are worth materially more than its current share price implies. However, the stock is lacking near term share price catalysts and investors will need to be patient.

PLS Group Ltd (ASX: PLS)

This lithium giant delivered a stronger than expected second-quarter update, with spodumene sales and revenue coming in ahead of expectations.

But this isn’t quite enough for a buy rating. The broker has upgraded PLS shares to a hold rating with a $4.60 price target. It explains:

Strong 2Q26 with a material spodumene sales and revenue beat vs MorgansF and consensus expectations. Cash balance +12% qoq with total liquidity of ~A$1.6bn leaving significant flexibility to fund growth and consider shareholder returns. Management is assessing the potential restart of the 200ktpa Ngungaju plant and other growth options in P2000 and Colina. Upgrade to HOLD (previously TRIM) on recent share price weakness with an unchanged A$4.60ps target price.

The post Are Graincorp and PLS shares buys, holds, or sells? appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.