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2 Big Agriculture Operations Stocks to Buy Despite Recent Headwinds
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Key Takeaways
ADM gains from Nutrition rebound, with Flavors growth driven by demand and improved pricing mix.
CTVA taps innovation pipeline and collaborations to meet rising demand for natural products.
Both benefit from pricing strength, product demand and efficiency efforts amid industry challenges.
The agriculture operations industry is facing structural challenges, including volatile commodity prices, elevated input and labor costs, trade-related uncertainty, and rising operating expenses. The field is thwarted by compressed margins and disrupting productivity, testing its long-term sustainability.
Nevertheless, the industry’s longer-term outlook remains constructive. Innovation across seeds, crop inputs, food processing and supply chains, combined with rising consumer preference for healthier and sustainably produced food, is creating growth avenues.
The Zacks-defined Agriculture – Operations industry is currently within the top 23% of the Zacks Industry Rank. Since it is ranked in the top half of the Zacks Ranked Industries, we expect it to outperform the market over the next three to six months.
Here, we recommend two agriculture operations bigwigs with a favorable Zacks Rank for investment. These are: Archer-Daniels-Midland Co. (ADM - Free Report) and Corteva Inc. (CTVA - Free Report) . Each of our picks currently carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the price performance of our two picks year to date.
Image Source: Zacks Investment Research
Archer-Daniels-Midland Co.
Zacks Rank #1 Archer-Daniels-Midland is benefiting from a rebound in its Nutrition segment. Human Nutrition is gaining traction, with the Flavors portfolio benefiting from solid North American demand, international customer wins and improved margins from favorable mix and disciplined pricing.
ADM continues to advance its Optimize, Drive and Grow pillars, enhancing productivity, accelerating cost savings, expanding BioSolutions and leveraging digital tools to unlock margin opportunities and strengthen customer reach.
ADM is actively managing productivity and innovation as well as aligning work to the interconnected trends in food security, health and wellbeing. The company is well-positioned for sustainable long-term profit growth across new avenues.
ADM has been creating additional margin opportunities, opening up channels to customers, advancing digital technologies in areas like farmer needs, the extension of Regen Act programs and partnerships, and the growth of its BioSolutions platform.
Archer-Daniels-Midland has an expected revenue and earnings growth rate of 5% and 26%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 9.4% over the last 30 days.
Corteva Inc.
Zacks Rank #2 Corteva is poised to drive above-market growth through its industry-leading product pipeline and rigorous approach to innovation and operating discipline. CTVA operates through two segments, Seed and Crop Protection.
CTVA is poised to accelerate its pace of innovation and existing leadership position in the high-value sector to meet the increasing market demand for naturally derived products through three collaboration agreements. Strong price execution in seed, supply-chain flexibility and solid market demand for CTVA’s balanced and differentiated new product portfolios drive its performance.
Corteva has an expected revenue and earnings growth rate of 4% and 8.7%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 1.4% over the last 30 days.
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2 Big Agriculture Operations Stocks to Buy Despite Recent Headwinds
Key Takeaways
The agriculture operations industry is facing structural challenges, including volatile commodity prices, elevated input and labor costs, trade-related uncertainty, and rising operating expenses. The field is thwarted by compressed margins and disrupting productivity, testing its long-term sustainability.
Nevertheless, the industry’s longer-term outlook remains constructive. Innovation across seeds, crop inputs, food processing and supply chains, combined with rising consumer preference for healthier and sustainably produced food, is creating growth avenues.
The Zacks-defined Agriculture – Operations industry is currently within the top 23% of the Zacks Industry Rank. Since it is ranked in the top half of the Zacks Ranked Industries, we expect it to outperform the market over the next three to six months.
Here, we recommend two agriculture operations bigwigs with a favorable Zacks Rank for investment. These are: Archer-Daniels-Midland Co. (ADM - Free Report) and Corteva Inc. (CTVA - Free Report) . Each of our picks currently carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the price performance of our two picks year to date.
Image Source: Zacks Investment Research
Archer-Daniels-Midland Co.
Zacks Rank #1 Archer-Daniels-Midland is benefiting from a rebound in its Nutrition segment. Human Nutrition is gaining traction, with the Flavors portfolio benefiting from solid North American demand, international customer wins and improved margins from favorable mix and disciplined pricing.
ADM continues to advance its Optimize, Drive and Grow pillars, enhancing productivity, accelerating cost savings, expanding BioSolutions and leveraging digital tools to unlock margin opportunities and strengthen customer reach.
ADM is actively managing productivity and innovation as well as aligning work to the interconnected trends in food security, health and wellbeing. The company is well-positioned for sustainable long-term profit growth across new avenues.
ADM has been creating additional margin opportunities, opening up channels to customers, advancing digital technologies in areas like farmer needs, the extension of Regen Act programs and partnerships, and the growth of its BioSolutions platform.
Archer-Daniels-Midland has an expected revenue and earnings growth rate of 5% and 26%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 9.4% over the last 30 days.
Corteva Inc.
Zacks Rank #2 Corteva is poised to drive above-market growth through its industry-leading product pipeline and rigorous approach to innovation and operating discipline. CTVA operates through two segments, Seed and Crop Protection.
CTVA is poised to accelerate its pace of innovation and existing leadership position in the high-value sector to meet the increasing market demand for naturally derived products through three collaboration agreements. Strong price execution in seed, supply-chain flexibility and solid market demand for CTVA’s balanced and differentiated new product portfolios drive its performance.
Corteva has an expected revenue and earnings growth rate of 4% and 8.7%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 1.4% over the last 30 days.