Archer Daniels Midland (ADM) Advances While Market Declines: Some Information for Investors

Archer Daniels Midland (ADM) ended the recent trading session at $54.39, demonstrating a +1.59% change from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily loss of 0.01%. At the same time, the Dow lost 0.32%, and the tech-heavy Nasdaq gained 0.05%.

The agribusiness giant's stock has dropped by 0.83% in the past month, falling short of the Consumer Staples sector's gain of 0.42% and the S&P 500's gain of 5.37%.

Investors will be eagerly watching for the performance of Archer Daniels Midland in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.88, signifying a 14.56% drop compared to the same quarter of the previous year. In the meantime, our current consensus estimate forecasts the revenue to be $21.11 billion, indicating a 5.13% decline compared to the corresponding quarter of the prior year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $4.03 per share and revenue of $84.15 billion, indicating changes of -14.98% and -1.61%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for Archer Daniels Midland. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.44% lower. As of now, Archer Daniels Midland holds a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Archer Daniels Midland has a Forward P/E ratio of 13.27 right now. For comparison, its industry has an average Forward P/E of 16.45, which means Archer Daniels Midland is trading at a discount to the group.

We can also see that ADM currently has a PEG ratio of 2.99. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. ADM's industry had an average PEG ratio of 1.6 as of yesterday's close.

The Agriculture - Operations industry is part of the Consumer Staples sector. With its current Zacks Industry Rank of 202, this industry ranks in the bottom 19% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on Zacks.com to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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Archer Daniels Midland Company (ADM) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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