Analyst Salvator Tiano from Bank of America Securities reiterated a Sell rating on Archer Daniels Midland and keeping the price target at $54.00.
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Salvator Tiano has given his Sell rating due to a combination of factors impacting Archer Daniels Midland’s financial outlook. Despite the expectation of improved crush margins over the next two years, the current stock valuation already reflects this positive outlook, leading to the reiteration of an Underperform rating. Additionally, delays in finalizing renewable volume obligations have pushed back the anticipated recovery, prompting a reduction in the 2026 earnings per share estimate.
Furthermore, while there is potential for a significant increase in crush margins by 2027, the growth in crush supply in the U.S. is expected to limit margin expansion during this cycle. The agricultural trading environment remains challenging, with limited growth prospects for Ag Services due to competition from Brazil. The company’s focus on debt repayment over share buybacks further influences the cautious outlook, as reflected in the unchanged price objective of $54.
In another report released on November 5, J.P. Morgan also downgraded the stock to a Sell with a $59.00 price target.