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Research Alert: CFRA Cuts Opinion On Shares Of Archer-daniels-midland Company To Hold From Buy
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Research Alert: CFRA Cuts Opinion On Shares Of Archer-daniels-midland Company To Hold From Buy
Apr 30, 2024 12:41 PM

03:15 PM EDT, 04/30/2024 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:

We cut our 12-month target by $5 to $62, 11.5x our 2024 EPS of $5.41 (cut from $6.13; 2025 cut to $5.56 from $6.34) vs. the 14.0x long-term average. Q1 adj-EPS of $1.46 (-30% Y/Y) beat by $0.09. Adj-segment operating profit fell 24% Y/Y to $1,317M. All core segments faced lower profits, particularly Ag Services & Oilseeds (AS&O), which was down 29% Y/Y. Based on the current forward curves, soybean crush margins will likely further weaken in Q2 and Q3 before potentially recovering by the end of the year. ADM kept guidance unchanged, but we see some risk of guidance being cut sometime this year. The macro environment is normalizing after a volatile few years. Ample crop supplies in South America and stabilizing global trade flows are proving to be major headwinds this year. We do, however, see limited downside risk to shares, driven by ADM's attractive capital allocation strategy, noting ADM repurchased $1.3B in Q1 and will likely repurchase an additional $900M over the next three quarters. We move to Hold.

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