Archer Daniels Midland (ADM) AI Stock Analysis

• Market Cap: $22.85B
• Dividend Yield: 4.22%
• Average Volume (3M): 5.17M
• Price to Earnings (P/E): 13.0
• Beta (1Y): 0.42
• Revenue Growth: -9.01%
• EPS Growth: -43.53%
• Country: US
• Employees: 42,383
• Sector: Industrials
• Sector Strength: 78
• Industry: Agricultural Farm Products
• EPS (TTM): 3.61
• Shares Outstanding: 480,155,670
• 10 Day Avg. Volume: 2,702,945
• 30 Day Avg. Volume: 5,169,756
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.40
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 5.55
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $48.14
• Price Target Upside: 0.61% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 7

Archer Daniels Midland scores a 66, reflecting mixed financial performance with declining revenues and cash flow challenges, yet maintaining operational efficiency. The technical indicators suggest some upward momentum despite bearish trends. Valuation appears reasonable with a strong dividend yield. Although the earnings call highlighted operational improvements, market challenges and nutrition segment struggles pose risks.

Positive Factors

Cost savings

ADM announced $200-300 million of cost savings in 2025 and $500-750 million of savings over the next 3-5 years, driven by improvements in manufacturing costs and targeted workforce reductions.

Macro landscape positioning

ADM is relatively-better positioned against most companies in the new macro landscape.

Negative Factors

Biofuel policy uncertainty

The ag cycle is at a trough, and biofuels policies remain uncertain, potentially keeping a lid on profitability and positioning downside risk.

Energy prices impact

Lower energy prices are weighing on ethanol, biodiesel, and soybean oil prices.

Trade pressure

Chinese tariffs on US crop exports should pressure ADM’s trading profits.

Archer Daniels Midland Business Overview & Revenue Model

Company Description

Archer-Daniels-Midland Company procures, transports, stores, processes, and merchandises agricultural commodities, products, and ingredients in the United States, Switzerland, Cayman Islands, Brazil, Mexico, the United Kingdom, and internationally. The company operates through three segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition. It procures, stores, cleans, and transports agricultural raw materials, such as oilseeds, corn, wheat, milo, oats, and barley. The company also engages in the agricultural commodity and feed product import, export, and distribution; and structured trade finance activities. In addition, it offers vegetable oils and protein meals; ingredients for the food, feed, energy, and industrial customers; crude vegetable oils, salad oils, margarine, shortening, and other food products; and partially refined oils to produce biodiesel and glycols for use in chemicals, paints, and other industrial products. Further, the company provides peanuts, peanut-derived ingredients, and cotton cellulose pulp; sweeteners, corn and wheat starches, syrup, glucose, wheat flour, and dextrose; alcohol and other food and animal feed ingredients; ethyl alcohol and ethanol; corn gluten feed and meal; distillers' grains; and citric acids. Additionally, the company provides natural flavors, flavor systems, natural colors, proteins, emulsifiers, soluble fiber, polyols, hydrocolloids, and natural health and nutrition products, including probiotics, prebiotics, enzymes, and botanical extracts; and other specialty food and feed ingredients; edible beans; formula feeds, and animal health and nutrition products; and contract and private label pet treats and foods. It also offers futures commission merchant; commodity brokerage services; cash margins and securities pledged to commodity exchange clearinghouses; and cash pledged as security under certain insurance arrangements. The company was founded in 1902 and is headquartered in Chicago, Illinois.

How the Company Makes Money

ADM makes money through its diversified operations in the agricultural and food processing sectors. The company's revenue streams include the sale of processed agricultural commodities, such as oilseeds and corn, which are transformed into ingredients for food, animal feed, and industrial products. Additionally, ADM generates income from its biofuels segment, particularly in the production and sale of ethanol. The company benefits from strategic partnerships with farmers and other agribusinesses, ensuring a steady supply of raw materials and access to global markets. ADM also engages in trading operations, leveraging its extensive supply chain to optimize commodity sales and distribution, contributing significantly to its earnings.

Archer Daniels Midland Financial Statement Overview

Summary

Archer Daniels Midland exhibits a mixed financial position with moderate stability in its balance sheet and operational efficiency, although revenue and profitability have declined over recent years. Cash flow management presents challenges given the downward trend in free cash flow.

Income Statement

The company has demonstrated fluctuating revenue trends, with revenue decreasing from $101.8 billion in 2022 to $85.5 billion in 2024. Gross profit margin and net profit margin have shown signs of contraction, reflecting operational challenges. However, the company maintains an EBIT margin of approximately 2.42% in 2024, indicating some level of operational efficiency.

Balance Sheet

Archer Daniels Midland has a solid equity base with a debt-to-equity ratio of 0.46 in 2024, indicating moderate leverage. The return on equity has decreased over the years, falling to 8.12% in 2024, suggesting reduced profitability from equity investments. The equity ratio stands at 61.72% in 2024, showcasing a strong asset base funded by equity.

Cash Flow

The cash flow shows a declining free cash flow trend, with free cash flow decreasing from $2.97 billion in 2023 to $1.22 billion in 2024. The operating cash flow to net income ratio of 1.54 indicates adequate cash generation relative to net income, but the declining cash flow is a concern.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
85.53B	93.94B	101.85B	85.25B	64.36B
	Gross Profit
5.78B	7.51B	7.57B	5.99B	4.45B
	EBIT
2.07B	4.06B	5.70B	3.78B	2.71B
	EBITDA
4.10B	6.01B	6.67B	4.58B	3.18B
	Net Income Common Stockholders
1.80B	3.48B	4.34B	2.71B	1.77B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
857.00M	5.39B	1.04B	943.00M	666.00M
	Total Assets
53.27B	54.63B	59.77B	56.14B	49.72B
	Total Debt
11.54B	9.60B	10.29B	10.58B	11.05B
	Net Debt
10.93B	8.23B	9.25B	9.64B	10.39B
	Total Liabilities
30.84B	30.17B	35.16B	33.37B	29.62B
	Stockholders Equity
22.17B	24.13B	24.28B	22.48B	20.00B
Cash Flow		Free Cash Flow
1.23B	2.97B	2.16B	5.43B	-3.21B
	Operating Cash Flow
2.79B	4.46B	3.48B	6.59B	-2.39B
	Investing Cash Flow
-2.70B	-1.50B	-1.40B	-2.67B	4.46B
	Financing Cash Flow
-1.53B	-4.60B	-2.50B	-1.12B	-423.00M

Archer Daniels Midland Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 47.85
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ADM, the sentiment is Positive. The current price of 47.85 is above the 20-day moving average (MA) of 46.50, above the 50-day MA of 47.10, and below the 200-day MA of 52.47, indicating a neutral trend. The MACD of 0.37 indicates Negative momentum. The RSI at 54.20 is Neutral, neither overbought nor oversold. The STOCH value of 35.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ADM.

Archer Daniels Midland Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CALM	84 Outperform	$4.86B	4.89	48.27%	7.28%	60.00%	259.01%
TSN	76 Outperform	$21.23B	20.11	5.74%	3.27%	1.27%	―
FDP	76 Outperform	$1.60B	10.93	7.51%	3.12%	-0.69%	―
SFD	72 Outperform	$8.65B	―		―	―	―
BG	67 Neutral	$10.22B	9.54	10.95%	3.46%	-10.78%	-45.77%
ADM	66 Neutral	$22.85B	13.03	7.78%	4.22%	-9.01%	-43.53%
Sector *	64 Neutral	$4.28B	11.80	5.30%	250.74%	4.12%	-9.02%

Archer Daniels Midland Corporate Events

Archer Daniels Midland Announces Leadership Changes in 2025

On January 29, 2025, Archer Daniels Midland Company announced the appointment of Carrie Nichol as Vice President and Chief Accounting Officer, effective March 1, 2025. Nichol, with over 20 years of experience in finance and accounting, joins from Cargill and will succeed Molly Strader Fruit, who will transition to Vice President, Total Rewards and HR Operations. Nichol’s extensive background is expected to strengthen ADM’s finance organization and support its strategic priorities.