Sector: earnings trough passed
Sector earnings contraction appears to have reached an end in 2Q26, with earnings expected to stabilize YoY in 3Q26F before returning to YoY growth from 4Q26F onward, supported by improving livestock margins and resilient aquatic earnings.
Research
Food – Entering a new earnings upcycle (Presentation)
Livestock fundamentals are improving
Livestock fundamentals are improving as Thai swine and broiler prices recover on tighter supply, while China’s swine market is gradually recovering as oversupply eases. Together with manageable feed costs, this should support a more favorable earnings outlook through 2H26F and into 1H27F. BTG is our pick.
Aquatic earnings remains intact
Despite higher tuna prices, which TU views as temporary and manageable, resilient customer orders, a weaker Thai baht and limited tariff impact should continue to support aquatic earnings. TU is another pick.