“As of Dec 25, tentative progress in the US-led peace discussions has raised hopes of de-escalation,” Cheong and Mo write.
The pair note that the US and Ukraine are looking to finalise a peace deal at the upcoming World Economic Forum in Davos, Switzerland. The forum is set to take place from Jan 19 to 23. Any progress made toward a ceasefire will likely benefit FEH given that it would support demand recovery in both Russia and Ukraine, they add.
In addition, Cheong and Mo point out that FEH’s earnings have seen an uplift thanks to an appreciation in the Russian ruble, which has gained by more than 40% against the US dollar in the past year.
“This was supported by Russia’s strong export surplus, stringent capital controls, and elevated domestic interest rates, alongside a broader weakening of the US dollar,” the analysts write.
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Besides Russia and Ukraine, Cheong and Mo say FEH’s ongoing share buybacks will lend further support to the company’s share price “in the near term.” FEH repurchased a total of 2.68 million shares after resuming its share buybacks in 4Q2025.
“While the company does not have a formal buyback mandate, this move underscores management’s confidence in the company’s long-term prospects and commitment to enhancing shareholder value, while also providing a positive signal to the market,” say Cheong and Mo.
UOB Kay Hian’s target price of $3 is based on a 19x PE for FY2026 earnings, which is at a 1.5SD above the company’s long-term historical mean. The company is currently trading at 17x PE for FY2026 earnings, which Cheong and Mo say is at a “deep 32% discount” to the average 25x its regional peers are trading at.
As at 11.16am, shares in Food Empire are trading 5 cents higher or 1.94% up at $2.63.
