● With the strong 280% surge in its share price since Oct. 2008, Noble is now trading on 14x P/E, versus its historical and peer group average of 8.5x and 13x. Over this period, consensus has cut FY09E earnings by 31%, and we foresee further downgrades.

● Comparing volume and earnings growth profiles of both Olam and Noble, the former has demonstrated steadier metrics. Against volatile commodity markets then, Olam has also consistently delivered incremental YoY net contribution margin growth.

● We expect Olam to deliver 26% YoY core earnings growth in FY09E, on 16% YoY volume growth, against Noble‘s almost flat tonnage growth profile and a 53% YoY core earnings decline, versus consensus expectation of 12% YoY decline.

● Noble‘s outperformance also implies its valuation discount to Olam has narrowed considerably, with both now trading at parity. We maintain our UNDERPERFORM rating on Noble. While we believe that the medium to longer-term commodities theme is far from over, we would look for a more attractive entry point for the stock. For now, we prefer Olam on earnings and valuation metrics.