- Archer-Daniels-Midland’s 3rd quarter adjusted EPS fell short of estimates at $1.09 compared to $1.63 y/y. The estimate was $1.18.
- Revenue for the quarter was $19.94 billion, down 8.1% year-on-year, missing the estimate of $21.33 billion.
- Carbohydrate Solutions revenue stood at $2.91 billion, a 13% decrease y/y, below the estimate of $3.01 billion.
- Nutrition sales increased by 2.6% to $1.83 billion, yet fell short of the $1.9 billion estimate.
- The Ag Services & Oilseeds division reported revenue of $15.09 billion, 8.4% lower y/y and below the $15.72 billion estimate.
- Oilseeds processing volume was 8.41 million metric tons, a 2.8% decrease y/y, missing dual estimates of 8.67 million metric tons.
- Corn processing volume rose by 9.7% to 4.94 million metric tons, surpassing both estimates of 4.45 million metric tons.
- The operating profit for Ag Services & Oilseeds significantly dropped by 43% to $480 million y/y.
- Carbohydrate Solutions posted an operating profit of $452 million, a 3.4% decrease y/y.
- Nutrition’s operating profit was $105 million.
- The company maintains its annual EPS forecast range of $4.50 to $5, aligned with an estimate of $4.93.
- Consolidated results were not impacted by restatements.
- 4th quarter predictions: Ag Services & Oilseeds operating profit is expected to be lower y/y due to reduced margins.
- Carbohydrate Solutions is anticipated to see similar operating profits as last year, despite differing factors such as strong ethanol fundamentals and weakening wheat milling margins.
- The Nutrition segment is expected to have a higher operating profit y/y in the 4th quarter but lower than the 3rd quarter due to weaker consumer demand and operational challenges.
- Analyst ratings include 0 buys, 11 holds, and 1 sell recommendations.
Archer Daniels Midland Co on Smartkarma
Analyst coverage of Archer Daniels Midland Co on Smartkarma shows mixed sentiments from different analysts. Baptista Research, with a bullish view, highlighted in their report the challenges ADM faced in the second quarter of 2024. Despite reporting adjusted earnings per share of $1.03 and operating profit of $1 billion, ADM felt pressures from the global commodities market, although it demonstrated robust cash flow. The report emphasized underlying portfolio pressures within the company.
Contrastingly, Srinidhi Raghavendra‘s analysis, with a bearish lean, portrayed a dimmer outlook for ADM in their Q2 earnings review. The report pointed out that ADM fell short of expectations, notably in the Ag Services & Oilseeds and Nutrition sectors. While Carbohydrate Solutions showed temporary improvements, the overall outlook for Q3 was subdued, expecting a stronger performance in the Nutrition business throughout the year. This varied sentiment from analysts underscores the complexity of ADM’s current operating environment.
A look at Archer Daniels Midland Co Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 3 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.6 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Archer Daniels Midland Co shows a promising future based on the Smartkarma Smart Scores. With high scores across Value, Dividend, and Growth factors, the company demonstrates strong fundamentals and potential for long-term growth. The Value score of 4 indicates that the company’s stock is likely undervalued compared to its intrinsic worth. Additionally, a solid Dividend score of 4 suggests that investors can expect stable and attractive dividend payouts. Moreover, a Growth score of 4 highlights the company’s potential for expansion and increasing profitability.
Although Archer Daniels Midland Co scores slightly lower in Resilience and Momentum factors with scores of 3, the overall outlook remains positive. The company’s operations in procuring, processing, and merchandising agricultural commodities position it well in the industry. With a focus on oilseeds, corn, oats, and other products for food and feed ingredients, Archer Daniels Midland Co is poised to capitalize on the demand for agricultural goods in the long term.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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