Back to top

Image: Bigstock

Why the Market Dipped But Archer Daniels Midland (ADM) Gained Today

Read MoreHide Full Article

In the latest trading session, Archer Daniels Midland (ADM - Free Report) closed at $60.70, marking a +1.4% move from the previous day. This change outpaced the S&P 500's 0.55% loss on the day. Elsewhere, the Dow lost 0.19%, while the tech-heavy Nasdaq lost 0.95%.

Prior to today's trading, shares of the agribusiness giant had lost 6.77% lagged the Consumer Staples sector's loss of 5.64% and the S&P 500's gain of 3.64%.

The investment community will be paying close attention to the earnings performance of Archer Daniels Midland in its upcoming release. The company's upcoming EPS is projected at $0.98, signifying a 10.09% drop compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $20.17 billion, indicating a 1.18% upward movement from the same quarter last year.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $4.02 per share and a revenue of $83.75 billion, signifying shifts of -15.19% and -2.09%, respectively, from the last year.

Any recent changes to analyst estimates for Archer Daniels Midland should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Archer Daniels Midland is currently sporting a Zacks Rank of #3 (Hold).

With respect to valuation, Archer Daniels Midland is currently being traded at a Forward P/E ratio of 14.88. For comparison, its industry has an average Forward P/E of 15.46, which means Archer Daniels Midland is trading at a discount to the group.

Meanwhile, ADM's PEG ratio is currently 3.17. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Agriculture - Operations industry had an average PEG ratio of 1.86.

The Agriculture - Operations industry is part of the Consumer Staples sector. With its current Zacks Industry Rank of 171, this industry ranks in the bottom 31% of all industries, numbering over 250.

The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Archer Daniels Midland Company (ADM) - free report >>

Published in