Archer Daniels Midland (ADM) AI Stock Analysis

• Market Cap: $28.12B
• Dividend Yield: 3.55%
• Average Volume (3M): 2.38M
• Price to Earnings (P/E): 24.9
• Beta (1Y): 0.38
• Revenue Growth: -4.31%
• EPS Growth: -29.96%
• Country: US
• Employees: 42,383
• Sector: Consumer Defensive
• Sector Strength: 42
• Industry: Agricultural Farm Products
• EPS (TTM): 0.92
• Shares Outstanding: 480,569,730
• 10 Day Avg. Volume: 2,040,328
• 30 Day Avg. Volume: 2,383,557
• PEG Ratio: -0.31
• Price to Book (P/B): 1.09
• Price to Sales (P/S): 0.28
• P/FCF Ratio: 19.68
• Enterprise Value/Market Cap: 1.16
• Enterprise Value/Revenue: 0.16
• Enterprise Value/Gross Profit: 2.68
• Enterprise Value/Ebitda: 4.29
• 1Y Price Target: $56.80
• Price Target Upside: -7.17% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 5
• EPS Forecast (FY): 4.24
• Revenue Forecast (FY): $87.40B

• Rating: 64 Neutral
• Price Target: $62.00 ▲(1.32% Upside)

ADM's overall stock score reflects a stable financial foundation with strong cash flow management and a solid balance sheet. However, challenges in revenue growth, declining profit margins, and mixed technical indicators weigh on the score. The company's strategic initiatives, such as the joint venture with Alltech, and its commitment to operational efficiency and shareholder returns provide potential upside, but uncertainties in global demand and policy remain significant risks.

Positive Factors

Cash Flow Management

Strong cash flow management supports ADM's operational and financial activities, ensuring liquidity and the ability to invest in growth opportunities.

Operational Efficiency

Improvements in operational efficiency enhance productivity and cost management, contributing to sustained profitability and competitive advantage.

Animal Nutrition Growth

The significant growth in the Animal Nutrition segment indicates successful strategic focus on higher-margin products, boosting long-term profitability.

Negative Factors

Revenue Growth Challenges

Minimal revenue growth suggests challenges in expanding market share or product adoption, potentially limiting future earnings potential.

Declining Profit Margins

Decreasing profit margins indicate pressure on profitability, which can affect ADM's ability to reinvest in the business and sustain long-term growth.

Biofuel Policy Uncertainty

Uncertainty in biofuel policy affects demand and profitability in key segments, posing risks to ADM's revenue stability and strategic planning.

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 generates revenue through multiple streams, primarily from the processing of agricultural commodities and the sale of derived products. Key revenue streams include the sale of oilseeds and their byproducts, corn processing (which includes sweeteners, starches, and ethanol), and milling operations for flour and related products. The company also earns income from its global trading operations and logistics services, which facilitate the movement of agricultural products. Significant partnerships with farmers, food manufacturers, and energy companies enhance ADM's supply chain efficiency and market reach. Additionally, ADM's investments in biotechnology and sustainability initiatives contribute to its earnings by meeting growing consumer demand for healthier and more sustainable food options.

Archer Daniels Midland Financial Statement Overview

Summary

ADM demonstrates a stable financial position with strengths in cash flow management and a solid balance sheet. However, challenges in revenue growth and declining profit margins highlight areas for improvement. The company maintains operational efficiency, but enhancing profitability and sustaining growth will be crucial for future success.

Income Statement

ADM's income statement shows a mixed performance. The TTM data indicates a slight revenue growth of 0.53%, but this follows a decline in the previous year. Gross profit and net profit margins have decreased over the years, indicating pressure on profitability. However, the company maintains positive EBIT and EBITDA margins, suggesting operational efficiency. Overall, while there are challenges in maintaining growth, the company remains profitable.

Balance Sheet

ADM's balance sheet reflects a stable financial position with a moderate debt-to-equity ratio of 0.41 in the TTM period, showing a decrease from previous years, which is a positive sign. The return on equity has decreased to 5.33% in the TTM period, indicating a decline in profitability relative to shareholder equity. The equity ratio remains healthy, suggesting a solid capital structure. Overall, the balance sheet indicates financial stability with manageable leverage.

Cash Flow

ADM's cash flow statement shows strong free cash flow growth of 14.46% in the TTM period, recovering from previous declines. The operating cash flow to net income ratio is healthy, indicating good cash generation relative to net income. The free cash flow to net income ratio is also strong, suggesting efficient cash management. Overall, the cash flow position is robust, supporting the company's operational and financial activities.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	207.21B	85.53B	93.94B	101.56B	85.25B	64.36B
Gross Profit	12.15B	5.78B	7.51B	7.57B	5.99B	4.45B
EBITDA	7.58B	4.10B	6.00B	6.66B	4.57B	3.20B
Net Income	2.59B	1.80B	3.48B	4.34B	2.71B	1.77B
Balance Sheet
Total Assets	51.92B	53.27B	54.63B	59.77B	56.14B	49.72B
Cash, Cash Equivalents and Short-Term Investments	5.88B	857.00M	1.37B	1.04B	943.00M	666.00M
Total Debt	9.21B	11.54B	9.60B	10.29B	10.58B	11.05B
Total Liabilities	29.17B	30.84B	30.17B	35.16B	33.37B	29.62B
Stockholders Equity	22.49B	22.17B	24.13B	24.28B	22.48B	20.00B
Cash Flow
Free Cash Flow	12.43B	1.23B	2.97B	2.16B	5.43B	-3.21B
Operating Cash Flow	15.79B	2.79B	4.46B	3.48B	6.59B	-2.39B
Investing Cash Flow	-3.19B	-2.70B	-1.50B	-1.40B	-2.67B	4.46B
Financing Cash Flow	-9.76B	-1.53B	-4.60B	-2.50B	-1.12B	-423.00M

Archer Daniels Midland Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 61.19
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• 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 61.19 is above the 20-day moving average (MA) of 58.76, above the 50-day MA of 58.77, and above the 200-day MA of 54.91, indicating a bullish trend. The MACD of 0.18 indicates Negative momentum. The RSI at 60.20 is Neutral, neither overbought nor oversold. The STOCH value of 65.45 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	73 Outperform	$3.77B	3.19	48.69%	10.53%	65.80%	197.95%
SFD	69 Neutral	$8.53B	10.17	―	4.44%	―	―
TSN	69 Neutral	$19.45B	42.12	2.60%	3.48%	2.12%	-40.75%
BG	66 Neutral	$17.90B	10.48	10.24%	3.14%	10.29%	17.32%
ADM	64 Neutral	$28.12B	24.90	5.35%	3.55%	-4.31%	-29.96%
FDP	64 Neutral	$1.66B	21.76	3.95%	3.34%	1.11%	414.23%
Sector *	62 Neutral	$20.33B	14.63	-3.31%	3.23%	1.93%	-12.26%