Archer-Daniels-Midland Company

Archer-Daniels-Midland Company (ADM - Analyst Report) has seen earnings estimates climb 41% over the past 3 months for the fiscal year ending June 2009. The company recently announced its acquisition of Schokinag-Schokolade-Industrie Herrmann GmbH & Co. KG, one of Europe's leading producers of chocolate and cocoa powder.

Company Description

Archer-Daniels-Midland, one of the largest agricultural processors worldwide, makes food ingredients, animal feed ingredients, renewable fuels and naturally derived alternatives to industrial chemicals. The company is headquartered in Decatur, Illinois.

Archer-Daniels-Midland explains that farmers are essential to the overall economy, which is why it works to be essential to the farming community, creating thousands of products from crops and providing hundreds of markets for farmers’ crops.

A Recent Acquisition

The Zacks #1 Rank (“strong buy”) company recently announced its acquisition of Schokinag-Schokolade-Industrie Herrmann GmbH & Co. KG, one of Europe's leading producers of chocolate and cocoa powder.

Archer-Daniels said this was an important step in the expansion of its global cocoa and chocolate business.

ADM’s acquisition of Schokinag will strengthen our position in Europe, the world’s largest chocolate market,” said Scott Walker, managing director, ADM Cocoa International. “By integrating Schokinag into our cocoa business, we will better serve this steadily growing chocolate market and realize significant efficiencies in sourcing, operations and transportation.”

Estimates are in the Rise

ADM has seen earnings estimates climb 41% over the past 3 months for the fiscal year ending June 2009. For the following year, analysts increased earnings forecasts by 10% in the past 3 months.

Favorable Industry Comparisons

Archer-Daniels-Midland’s return on equity (ROE) of 18% fare well against a negative industry average figure.

The company’s dividend yield of 1.9% is well above the industry average as ADM’s peers pay virtually no income.

The company’s net profit margin of 3% is also stacked up against a negative industry average.

ADM’s earnings per share are expected to grow by 18% over the next 3 – 5 years, which is in line with the industry average.

A Record Quarter

Archer-Daniels-Midland posted record results in its fiscal first quarter. Earnings per share of $1.63 more than doubled the year-prior 68 cents and soared past the consensus estimate by astonishing 133%.

Results for the second quarter are scheduled for release on February 3.

Read the full analyst report on ADM