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FMC Corp (FMC) Touches New 52-Week High: What's Driving It?
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Shares of FMC Corp. (FMC - Free Report) scaled a fresh 52-week high of $85.17 yesterday, before retracing to close the day at $84.74.
FMC Corp. has a market cap of roughly $11.4 billion and average volume of shares traded in the last three months is around 1,088.6K. The company has an expected long-term EPS growth of around 11.3%.
FMC Corp. has significantly outperformed the industry it belongs to over a year. The company’s shares have rallied 78.2% over this period compared with the industry’s gain of 17.3% over the same period.
Driving Factors
FMC Corp. posted strong second-quarter results earlier this month. It logged a profit of $75 million or 56 cents per share in the quarter, up from $65 million or 49 cents per share a year ago. Adjusted earnings of 48 cents per share beat the Zacks Consensus Estimate of 47 cents. Revenues rose roughly 7% year over year to $657 million, also topping the Zacks Consensus Estimate of $612 million.
FMC Corp. is benefiting from its strategic investments, acquisitions and efforts to expand its market position and strengthen its portfolio. The company is investing in technologies in its agriculture business and launching new products with a goal to enhance value to farmers.
FMC Corp. is seeing strong demand in its Lithium unit. The company is expanding its lithium hydroxide production capacity. It is executing this expansion in three phases. The move is based on the growing demand for electric vehicles. The company expects its lithium business to deliver strong earnings growth in 2017.
FMC Corp. now sees revenues in the range of $340-$360 million (up from $325-$365 million expected earlier) for the Lithium unit for 2017. Segment earnings are forecasted to be in the band of $115 to $125 million (up from $100 to $120 million expected earlier) for the full year.
The planned acquisition of a major portion of DuPont's (DD - Free Report) Crop Protection business has also provided a significant growth platform for FMC’s Agricultural Solutions unit. Under the terms of the agreement, FMC Corp. will buy DuPont's Cereal Broadleaf Herbicides and Chewing Insecticides portfolios as well as some of the latter’s Crop Protection research and development pipeline and organization. As part of the deal, DuPont will also purchase FMC's Health & Nutrition business that raked in more than $700 million in revenues in 2016.
After deal closure, FMC Corp.’s Agricultural Solutions unit will become the fifth biggest crop protection chemical company in the world by sales with estimated annual revenues of around $3.8 billion. The acquisition will significantly increase the company’s presence in Asia and Europe and will be immediately accretive to its adjusted earnings per share.
That said, FMC Corp. remains exposed to challenging agriculture market fundamentals. Agricultural market conditions remain challenging in North America due to elevated channel inventory levels and lower farm income due to weak commodity prices, affecting farmer demand in the region. The company is also seeing sluggishness in the European agricultural market.
Kronos has an expected long-term earnings growth of 5%.
Akzo Nobel has an expected long-term earnings growth of 11.1%.
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Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
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FMC Corp (FMC) Touches New 52-Week High: What's Driving It?
Shares of FMC Corp. (FMC - Free Report) scaled a fresh 52-week high of $85.17 yesterday, before retracing to close the day at $84.74.
FMC Corp. has a market cap of roughly $11.4 billion and average volume of shares traded in the last three months is around 1,088.6K. The company has an expected long-term EPS growth of around 11.3%.
FMC Corp. has significantly outperformed the industry it belongs to over a year. The company’s shares have rallied 78.2% over this period compared with the industry’s gain of 17.3% over the same period.
Driving Factors
FMC Corp. posted strong second-quarter results earlier this month. It logged a profit of $75 million or 56 cents per share in the quarter, up from $65 million or 49 cents per share a year ago. Adjusted earnings of 48 cents per share beat the Zacks Consensus Estimate of 47 cents. Revenues rose roughly 7% year over year to $657 million, also topping the Zacks Consensus Estimate of $612 million.
FMC Corp. is benefiting from its strategic investments, acquisitions and efforts to expand its market position and strengthen its portfolio. The company is investing in technologies in its agriculture business and launching new products with a goal to enhance value to farmers.
FMC Corp. is seeing strong demand in its Lithium unit. The company is expanding its lithium hydroxide production capacity. It is executing this expansion in three phases. The move is based on the growing demand for electric vehicles. The company expects its lithium business to deliver strong earnings growth in 2017.
FMC Corp. now sees revenues in the range of $340-$360 million (up from $325-$365 million expected earlier) for the Lithium unit for 2017. Segment earnings are forecasted to be in the band of $115 to $125 million (up from $100 to $120 million expected earlier) for the full year.
The planned acquisition of a major portion of DuPont's (DD - Free Report) Crop Protection business has also provided a significant growth platform for FMC’s Agricultural Solutions unit. Under the terms of the agreement, FMC Corp. will buy DuPont's Cereal Broadleaf Herbicides and Chewing Insecticides portfolios as well as some of the latter’s Crop Protection research and development pipeline and organization. As part of the deal, DuPont will also purchase FMC's Health & Nutrition business that raked in more than $700 million in revenues in 2016.
After deal closure, FMC Corp.’s Agricultural Solutions unit will become the fifth biggest crop protection chemical company in the world by sales with estimated annual revenues of around $3.8 billion. The acquisition will significantly increase the company’s presence in Asia and Europe and will be immediately accretive to its adjusted earnings per share.
That said, FMC Corp. remains exposed to challenging agriculture market fundamentals. Agricultural market conditions remain challenging in North America due to elevated channel inventory levels and lower farm income due to weak commodity prices, affecting farmer demand in the region. The company is also seeing sluggishness in the European agricultural market.
FMC Corp. is a Zacks Rank #3 (Hold) stock.
FMC Corporation Price and Consensus
FMC Corporation Price and Consensus | FMC Corporation Quote
Stocks to Consider
Better-placed companies in the basic materials space include Kronos Worldwide, Inc. (KRO - Free Report) and Akzo Nobel N.V. (AKZOY - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Kronos has an expected long-term earnings growth of 5%.
Akzo Nobel has an expected long-term earnings growth of 11.1%.
One Simple Trading Idea
Since 1988, the Zacks system has more than doubled the S&P 500 with an average gain of +25% per year. With compounding, rebalancing, and exclusive of fees, it can turn thousands into millions of dollars.
This proven stock-picking system is grounded on a single big idea that can be fortune shaping and life changing. You can apply it to your portfolio starting today.
Learn more >>