Money and Finance
It's been a while since I've post a stock analysis so today we'll look at one of my recent buys from last week, Archer Daniels Midland (ADM). Archer Daniels Midland closed on Friday, August 17th at $26.17.
Company Background:
Archer-Daniels Midland Company procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally. The companys Oilseeds Processing segment originates, merchandises, crushes, and processes oilseeds, such as soybeans and soft seeds, including cottonseed, sunflower seed, canola, rapeseed, and flaxseed into vegetable oils and protein meals. It offers crude vegetable oils, salad oils, partially refined oils, oilseed protein meals, natural health and nutrition products, specialty food and feed ingredients, cottonseed flour, and cotton cellulose pulp for the food, feed, energy, and other industrial products industries. This segment also operates fertilizer blending facilities. The companys Corn Processing segment converts corn into sweeteners, starches, and bio products. Its products include sweeteners, starch, syrup, glucose, and dextrose. This segment also produces alcohol, amino acids, and other specialty food and animal feed ingredients; corn gluten feed and meal, and distillers grains; vegetable oil and protein meal; and citric and lactic acids, lactates, sorbitol, xanthan gum, and glycols. The companys Agricultural Services segment buys, stores, cleans, transports, and resells agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley primarily as food and feed ingredients, and as raw materials for the agricultural processing industry. Its transportation network comprises truck, rail, barge, port, and ocean-going vessel handling and freight services. This segment also processes and distributes formula feeds, and animal health and nutrition products; and procures, processes, and distributes edible beans. In addition, the company offers commodity brokerage services; and cocoa liquor, cocoa butter, cocoa powder, chocolate, as well as writes crop insurance.
DCF Valuation:
Analysts expect ADM to grow earnings 10.00% per year for the next five years and I've assumed they can continue to grow at 3.50% per year thereafter. Running these numbers through a DCF analysis with a 11% discount rate yields a fair value price of $45.16. This means that at $26.17 the shares are undervalued by 42%.
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Money and Finance
Archer Daniels Midland Stock Analysis
It's been a while since I've post a stock analysis so today we'll look at one of my recent buys from last week, Archer Daniels Midland (ADM). Archer Daniels Midland closed on Friday, August 17th at $26.17.
Company Background:
Archer-Daniels Midland Company procures, transports, stores, processes, and merchandises agricultural commodities and products in the United States and internationally. The companys Oilseeds Processing segment originates, merchandises, crushes, and processes oilseeds, such as soybeans and soft seeds, including cottonseed, sunflower seed, canola, rapeseed, and flaxseed into vegetable oils and protein meals. It offers crude vegetable oils, salad oils, partially refined oils, oilseed protein meals, natural health and nutrition products, specialty food and feed ingredients, cottonseed flour, and cotton cellulose pulp for the food, feed, energy, and other industrial products industries. This segment also operates fertilizer blending facilities. The companys Corn Processing segment converts corn into sweeteners, starches, and bio products. Its products include sweeteners, starch, syrup, glucose, and dextrose. This segment also produces alcohol, amino acids, and other specialty food and animal feed ingredients; corn gluten feed and meal, and distillers grains; vegetable oil and protein meal; and citric and lactic acids, lactates, sorbitol, xanthan gum, and glycols. The companys Agricultural Services segment buys, stores, cleans, transports, and resells agricultural commodities, such as oilseeds, corn, wheat, milo, oats, rice, and barley primarily as food and feed ingredients, and as raw materials for the agricultural processing industry. Its transportation network comprises truck, rail, barge, port, and ocean-going vessel handling and freight services. This segment also processes and distributes formula feeds, and animal health and nutrition products; and procures, processes, and distributes edible beans. In addition, the company offers commodity brokerage services; and cocoa liquor, cocoa butter, cocoa powder, chocolate, as well as writes crop insurance.
DCF Valuation:
Analysts expect ADM to grow earnings 10.00% per year for the next five years and I've assumed they can continue to grow at 3.50% per year thereafter. Running these numbers through a DCF analysis with a 11% discount rate yields a fair value price of $45.16. This means that at $26.17 the shares are undervalued by 42%.
Read more »
- Archer Daniels Midland Co. Is Approaching Buy Territory
Oftentimes it's the behind-the-scenes companies that make investors rich. The companies that the average person might have never heard of, but use some form of their products every day. Archer Daniels Midland Company (NYSE:ADM) is one such company...
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It's time for another stock analysis report and this time I'll look at another dividend champion, 3M (MMM). 3M closed trading on Friday, January 11th at $96.28. Company Background: 3M Company operates as a diversified technology company worldwide....
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As mentioned in my previous post, I'm going to try and have 1 stock analysis report for some popular dividend growth stocks come out prior to their latest earnings release this week. Today we'll look at Chevron Corporation (CVX). Chevron closed...
- Air Products & Chemicals Stock Analysis
As mentioned in my previous post, I'm going to try and have 1 stock analysis report for some popular dividend growth stocks come out prior to their latest earnings release this week. Today we'll look at Air Products & Chemicals (APD). Air...
- Emerson Stock Analysis
Last week was a slow week for the blog because work was really busy, so I figured I'd give y'all another stock analysis. This time I decided to take a look at Emerson Electric Company (EMR). Emerson closed on Friday 5/25/12 at $47.28. Company...