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Archer Daniels' Yerbalatina Buyout to Boost Natural Products

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Archer Daniels Midland Company(ADM - Free Report) recently bought Yerbalatina Phytoactives, a Brazilian-based pioneering natural plant-based extracts maker. With this buyout, the company will be able to enhance its presence in Brazil, where it has an extensive human and animal nutrition business. Through this buyout, Archer Daniels will be able to serve customers with healthy and natural-source products in the foods and beverages space.

Notably, Yerbalatina uses proprietary cool-drying technology to transform fruits, vegetables and plants like acerola, acai, green coffee into a wide range of extracts. Moreover, it has a range of more than 100 botanical products and solutions, which include healthy ingredients as well as organic powdered fruits, food colorings, vegetable milks and nutritional extracts.

Furthermore, Archer Daniels is likely to benefit from Yerbalatina’s natural botanical extracts that comprise organic-certified ingredients, R&D competencies and expertise. This will reinforce the company’s leadership in science-based microbiome solutions for human and animal wellness.

We note that the global retail market for foods, beverages and supplements, highlighting health & wellness concepts, is flourishing and is anticipated to reach $750 billion. Impressively, the addition of Yerbalatina to the company’s portfolio is an important tool and will continue to leverage the power of nature to enrich human and animal health.

Meanwhile, Archer Daniels’ three strategic pillars — optimize, drive and growth — as well as Project Readiness initiative to drive overall growth bode well. The Readiness goals of improving business, standardizing functions and enriching consumers’ experience are on track.

The company’s strategic pillars, guided and supported by the Readiness program, are focused on accelerating and enhancing competitiveness. Management is optimistic about Archer Daniels’ leadership in key global trends like flexitarian diets, nutrition and sustainable materials. Moreover, the company is focused on investing in assets and technological capabilities to serve customers efficiently as well as boost growth.

Price Performance & Zacks Rank

Shares of the agricultural products company have gained 8% in the past six months compared with the industry’s rise of 5.4%.

Archer Daniels currently carries a Zacks Rank #3 (Hold).

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Lamb Weston Holdings, Inc (LW - Free Report) has an expected long-term earnings growth rate of 7.9% and sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

General Mills, Inc (GIS - Free Report) has an expected long-term earnings growth rate of 7% and carries a Zacks Rank #2 (Buy).

The Hain Celestial Group, Inc (HAIN - Free Report) delivered a positive earnings surprise of 14.3% in the last reported quarter. It currently carries a Zacks Rank #2.

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