$519.00
$4058.00
bear $519.00
base $2105.00
bull $4058.00
margin of safety $1100.00
market price* $3922.63
Seaboard Corporation is a diversified agribusiness and transportation conglomerate controlled by the Bresky family through Seaboard Flour (roughly three-quarters of the shares). It runs six businesses: Pork (Seaboard Foods; vertically integrated hog production and a processing plant in Guymon, Oklahoma, plus a 50% stake in Seaboard Triumph Foods), Commodity Trading & Milling (grain trading and flour/feed mills, mostly in Africa, the Caribbean and South America), Marine (containerized cargo service from Miami and Houston to the Caribbean and Central and South America), Liquid Fuels (biodiesel and a renewable diesel plant), Power (floating power barges selling into the Dominican Republic spot market), and Turkey (a 52.5% equity stake in Butterball). 2025 sales were $9.7 billion: CT&M $5.2B, Pork $2.0B, Marine $1.6B, Liquid Fuels $0.6B, Power $0.2B. How we measure the earnings. We start from operating cash flow, strip out working-capital swings (which are huge here because grain and hog inventories move with commodity prices), and subtract the capital spending needed to keep the business where it is. Seaboard reports no stock-based pay. Because sales grow mostly with commodity prices rather than volume, our method treats most capital spending as maintenance. That is harsh in some years, especially 2023-2025 when $250-300M a year went into eight new dual-fuel cargo ships. On that basis, owner earnings per share over 2016-2025 were: $199, $176, $176, -$129, $130, $271, $417, -$193, $21 and $139. For valuation we add back interest paid and take out the roughly $60-75M a year of interest and dividends earned on Seaboard's $1.1B securities portfolio, because we count that portfolio separately as a balance-sheet asset. Starting level. A commodity business needs a whole cycle. We use 2016-2025 but leave out 2021-2022: those years were lifted by the pandemic container-freight boom (Marine operating income rose $176M in 2021 and another $394M in 2022), and freight rates have since fallen back. The median of the remaining eight years is about $140M a year of cash before lenders, or about $146 per share. That figure covers two hog-cycle lows (2019, and 2023, when Pork lost $455M) and good years such as 2016-2018 and 2025. Cross-check: mid-cycle operating cash before working capital is roughly $500-550M on today's asset base, and capital spending should drop to about $400M once the ship program and the EDM IV barge are finished (2026 budget: $625M, including $150M for EDM IV). That leaves about $140M, which agrees. The last full year (2025) produced $135M, so the base case starts year one essentially flat with what the business actually earned. The first half of 2026 was stronger (operating income $196M vs $90M a year earlier). We treat that as the cyclical upswing, not a new normal. Growth. We credit almost none. Over ten years, sales grew from $5.4B to $9.7B, but owner earnings did not grow. The big projects (the renewable diesel plant, the pork joint venture, the fleet renewal) have not yet shown a lasting step-up in cash returns, so no general growth is in the bag. The only growth we credit is the EDM IV power barge. It costs about $315M, is under contract and being built, and is expected to start operating in 2028. We charge the roughly $200M still to be spent and credit $25M a year of cash in the base case, $10M in the bear and $40M in the bull. Those figures are scaled from the $46-71M the two existing barges earn. The deciding question for value is how long the earning power lasts. Seaboard has run Marine since the 1980s and Pork since the 1990s, and milling much longer, and its operating cash before working capital was positive in every year we examined. So the base case holds earnings flat in dollars indefinitely, which means they shrink after inflation, with no assumed growth. Cases (6% discount rate): Base ($2,105/share): about $140M a year indefinitely plus EDM IV. The business is worth about $2.42B. Net debt is about $405M: borrowings of $1.70B ($623M of credit lines, the $953M term loan due November 2033 and other notes totaling $986M, $94M of finance leases) plus $23M of minority interests, minus $1.11B of cash and short-term investments above operating needs and $214M of long-term investments. That leaves about $2.02B for shareholders. Bear ($519/share): $70M a year for ten years, then $50M. Several disclosed pressures stack up in this case: Liquid Fuels keeps losing money ($73M, $100M and $127M operating losses in 2023-2025) and loses its clean-fuel production credit after it expires at the end of 2029. Credit currently is worth only about 52% of the old blender's credit. There are repeated hog-cycle troughs like 2023, government price controls at African mills (cited in 2025), pork export tariffs, and continued spending of about $500M a year on new projects that earn little. EDM IV earns only $10M a year because cheaper Dominican generators are dispatched first, which already cut EDM III's output in 2025. The business is worth about $0.90B, owes $405M, and leaves about $0.50B. The business still covers its interest in this case, because the securities portfolio earns about as much as the gross interest bill. Bull ($4,058/share): 2025-2026 conditions hold. Marine keeps its 2025 operating income of $165M on the new fuel-efficient fleet, Pork stays profitable on lower feed costs, and capital spending settles near $400M once EDM IV and the ninth vessel ($75M, ordered 2025) are finished. That gives about $180M a year for two years and then $250M a year (about what 2025's operating cash would leave after normalized spending), with EDM IV at $40M a year. The business is worth about $4.29B, owes $405M, and leaves about $3.89B. Accounting judgements. Income from affiliates (Butterball, Seaboard Triumph Foods and others) counts only through the cash dividends they pay ($91M in 2025), not their reported earnings ($138M). The 2024 tax valuation allowance of $212M and its 2025 reversal ($170M) are non-cash and are excluded. We used the July 4, 2026 balance sheet. Credit-line borrowings rose by about $165M in the first half of 2026 to fund a $294M seasonal increase in inventory. If that unwinds by year-end, net debt would be about $170 per share lower than we assumed. Change from our August 2026 view (base $2,350, margin-of-safety price $1,400). We now treat working-capital swings as timing rather than earnings. We exclude the 2021-2022 freight-boom years from the starting level. We assume no general growth (previously 2.5% a year), and we discount every case at a flat 6% instead of 8.5-12%. The lower discount rate raises value, while the lower starting level, the absence of growth and the higher mid-year borrowing lower it. The net effect is a modestly lower base and a lower bear case. What would make this wrong. On the upside, if capital spending really does fall toward depreciation (about $320M) after 2028 and Marine holds its 2025 freight economics, cash generation of $250M+ a year is plausible, which is the bull case. On the downside, if Seaboard keeps spending $500M+ a year on projects that earn little, as it did in 2023-2025, the bear case applies. The gap between book value (about $5,700 per share) and our base case reflects how little cash those assets have produced for owners over the past decade. Margin-of-safety price. Value per share is spread from about $520 to $4,060, the business does not compound, and returns depend on how fast the discount closes. If the price converges on base value (which accretes about 6% a year, plus a $9 annual dividend) over four to five years, the base case implies a 20% annual return only from a price of roughly $1,000-1,300. The margin-of-safety price is $1,100, about half of base value. That leaves a cushion against the bear case while still requiring the median outcome to arrive.