Bunge Global's (BG) commercial and operational synergies with Viterra following merger earlier this year are likely to surprise positively over time, Morgan Stanley said in a Tuesday research report.

A favorable US biofuel policy around renewable volume obligation could prove advantageous for the company, analysts wrote.

The company's Q3 results in a tough macroeconomic landscape provide an early proof point of the merits of the Viterra deal. However, integration challenges remain, according to the note.

Morgan Stanley said it expects the company to refresh its mid-cycle EPS baseline to nearly $12 on a run-rate basis from $8.50 earlier at its upcoming investor day. For Q4, the brokerage raised its adjusted EPS guidance to $1.92 from $1.85 and revenue to $21 billion from $20.48 billion.

The brokerage said it upgraded the stock to overweight from equal-weight and raised its price target to $120 per share from $95.

Price: 93.03, Change: +0.44, Percent Change: +0.48