Chicago-based Archer-Daniels-Midland Company (ADM) engages in the procurement, transportation, storage, processing, and merchandising of agricultural commodities, ingredients, flavors, and solutions. With a market cap of $29.2 billion, the company’s operations span the Americas, Europe, and internationally.
The agriculture major has substantially underperformed the broader market over the past year. Over the past 52 weeks, ADM dipped 28.1%, trailing behind the S&P 500 Index’s ($SPX) 26.1% returns. In 2024 alone, ADM declined 18.2% compared to SPX’s 16.5% gains on a YTD basis.
Zooming in further, ADM also underperformed the Vaneck Agribusiness ETF’s (MOO) 12.8% dip over the past 52 weeks and a 5.3% decline in 2024.
Following the release of its Q2 earnings on Jul. 30, ADM’s stock declined by 1.3% and continued to trade in the red for the subsequent five sessions. The company reported an 11.7% year over year decline in revenues to $22.2 billion and a significant 50.9% drop in adjusted net income to $508 million.
For the current fiscal year, ending in December, analysts anticipate the company’s EPS to decline 21.6% year over year to $5.47. The company’s earnings surprise history is mixed. It beat the consensus estimate in two of the past four quarters while missing the forecasts on two other occasions.
Among the 12 analysts covering the ADM stock, the consensus rating is a “Hold.” That’s based on one “Strong Buy” rating, 10 “Holds,” and one “Strong Sell.”
The configuration has been stable over the past months.
On Jul. 15, Citi (C) analyst Thomas Palmer maintained a “Neutral” rating with a price target of $63, down from $64.
ADM’s mean price target of $63.09 represents a premium of 6.8% from current price levels. The Street-high target of $82 indicates a potential upside of 38.8%.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
