| 2021 | 2022 | 2023 | 2024 (projected) | Interest Expense | 265M | 396M | 455.4M | 354.9M | Depreciation And Amortization | 996M | 1.0B | 1.2B | 689.3M |
Ownership Breakdown
| Retail Investors20.29% | Institutions78.96% |
| Retail Investors | 20.29 | |
| Insiders | 0.75 | |
| Institutions | 78.96 |
Should you hold on to your Archer Daniels position?
 | By Rifka Kats | Macroaxis Story |
Archer Daniels Midland (ADM), a leading player in the Consumer Defensive sector, specifically in the Farm Products industry, has been a topic of interest for many investors. With an enterprise value of $37.2B and a market capitalization of $29.2B, this NYSE-listed company has shown a robust operating margin of 4.61%. Despite a quarterly revenue growth decline of 12%, the company managed to post a net income from continuing operations of $4.4B. However, it's worth noting a change to net income, resulting in a loss of $184M. With a Wall Street target price of $65.92, significantly higher than the current valuation market value of $54.91, is Archer Daniels Midland stock a compelling hold for your portfolio? Currently, Archer Daniels Midland's Price to Operating Cash Flows Ratio remains stable compared to the previous year. As of March 12, 2024, the Free Cash Flow Per Share is projected to increase to 4.63, while the Price to Sales Ratio is expected to decrease to 0.58. Amid concerns from some baby boomers about the food products sector, it's worthwhile to review Archer Daniels Midland. This article will delve into the stock's recent investor sentiment and highlight key factors influencing the company's products and services. Additionally, it will provide insights into the potential investment outlook for Archer Daniels in April.
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Reviewed by Raphi Shpitalnik
Institutional investors, such as insurance companies, hold over 79.0% of Archer Daniels Midland's shares. This institutional ownership refers to the equity in Archer-Daniels-Midland owned by entities like mutual funds, pension funds, investment firms, and foundations that manage funds on behalf of others. For the latest analysis of Archer, including its current ownership structure, refer to our recent ownership diagnostics.
Main Ideas
Archer Daniels Midland (ADM), a leading player in the Farm Products industry, has a robust market capitalization of $29.2B and a healthy net income of $4.4B, which signifies a strong product portfolio and efficient management. With a return on equity of 15.82%, the company has demonstrated its ability to generate profits from shareholders' equity, making its stock a compelling hold for your portfolio. The performance of Archer Daniels Midland in the marketplace will significantly impact your decision to invest in its stock. Revenue growth, profitability, competitive positioning, management quality, and industry trends can influence Archer Daniels' stock prices. When investing in Archer Daniels, there are several factors to consider and potential outcomes to expect. As a company performs well, its stock price may increase, allowing investors to benefit from price appreciation. However, Archer Stock can experience significant price fluctuations due to market conditions, economic factors, industry trends, or company-specific news. This is why investing in stocks such as Archer Daniels carries risks, including the potential for capital loss. Stock prices can decline, and investors may incur losses if they sell shares at a lower price than their initial investment.And What about dividends?
A dividend is the distribution of a portion of Archer Daniels earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Archer Daniels dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Archer one year expected dividend income is about USD1.17 per share.
As of the 27th of April 2024, Dividend Payout Ratio is likely to grow to 0.43, though Dividends Paid is likely to grow to (928.1 M). | Last Reported | Projected for Next Year | ||
| Dividends Paid | -977 M | -928.1 M | |
| Dividend Yield | 0.03 | 0.02 | |
| Dividend Payout Ratio | 0.28 | 0.43 | |
| Dividend Paid And Capex Coverage Ratio | (8.63) | (8.20) |
Investing in dividend-paying stocks, such as Archer Daniels Midland is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Archer Daniels must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Archer Daniels. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.How important is Archer Daniels's Liquidity
Archer Daniels financial leverage refers to using borrowed capital as a funding source to finance Archer Daniels Midland ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Archer Daniels financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Archer Daniels' owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Archer Daniels' financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Archer Daniels's total debt and its cash.
What do experts say about Archer?
Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions.
Analysis ConsensusIs Archer Daniels valued appropriately by the market?
Archer-Daniels-Midland retains a total of 533.38 Million outstanding shares. The majority of Archer Daniels Midland outstanding shares are owned by other corporate entities. These outside corporations are usually referred to as non-private investors looking to acquire positions in Archer-Daniels-Midland to benefit from reduced commissions. Consequently, institutional investors are subject to a different set of regulations than regular investors in Archer Daniels. Please pay attention to any change in the institutional holdings of Archer Daniels Midland as this could imply that something significant has changed or is about to change at the company. Note that regardless of who owns the company, if the true value of the entity is less than the market is willing to pay for it, you may not be able to generate positive returns over time.
Every cloud has a silver lining, and Archer Daniels Midland (ADM.US) may be that silver lining in your portfolio. Despite a risk-adjusted performance of -0.05, the company has a robust current ratio of 1.51X, indicating a healthy short-term liquidity position. With a net income of $4.37 billion and operating income of $5.7 billion, the company's financial health is solid. Furthermore, the company's EPS estimate for the current year stands at 7.03, and its price-to-book ratio is a reasonable 1.16X. While the probability of bankruptcy is 12.69%, the company's strong financial performance and the fact that 78.96% of its shares are owned by institutions suggest that Archer Daniels Midland is a compelling hold for your portfolio. .
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