Archer Daniels Midland Stock Analysis, Valuation (NYSE:ADM)

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$41.76 $0.36 (0.85%) ADM stock closing price Feb 22, 2018 (Closing)
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Archer Daniels Midland
Updated on : Feb 22, 2018
previous close
ADM 41.8 (0%)
S&P 500 2704 (0%)
Closing Price On: Feb 22, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Agricultural Operations
Sector :
Consumer Staples
5 Quarter Revenue
Revenue Growth
2017-Q4
$billion
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
-7.7%
Operating Profit
Operating Margin:
2.5%
Sector Average:
11.2%
5 Quarter Net Profit
Net Margins
2017-Q4
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
7.49B
Debt/Equity Ratio:
 0.41
Compared to the industry
Cash Flow
Operating cash flow:
$56M
Net Income:
$788M
Dividend Yield
ADM dividend yield:
3.07%
PROS      CONS
Low Debt Burden
PE Valuation
PS Valuation
Long Term Growth
Operating Margins
Net Margins
Cash Flow
FCF Margin
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
ADM PS :
0.4
Industry PS :
1.7
Sector:   Consumer Staples.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
7.2%
Return on Equity:
9.1%
Free Cash Flow Margin:
-1.7%
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ADM Stock Analysis

178 5 2

Take a look at Amigobulls Archer Daniels Midland stock analysis video. This is our analyst opinion covering the buy and sell arguments for ADM stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Archer Daniels Midland Company Stock Rating 2.8/5

Amigobulls ADM stock analysis takes into account various financial ratios like relative valuation, Archer Daniels Midland revenue, growth and return on equity based on latest quarter 2017 Q4 financial statements. We also check Archer Daniels Midland dividend performance. Archer Daniels Midland valuation forms a crucial part of our stock analysis. Archer Daniels Midland stock rating encapsulates our opinion about the company based on the fundamentals.

Should you buy ADM stock?

  • With its debt/equity ratio of  0.41, Archer Daniels Midland has a lower debt burden when compared to the Consumer Staples average.
  • The price to earnings multiple of 17.1 is attractive when compared with the industry average PE ratio of 23.
  • The lower PS ratio 0.4 for ADM stock versus Agricultural Operations industry average of 1.7 is a positive for the company.

Should you sell ADM stock?

  • The company saw an average annual sales decline of -7.7% in sales over the last 5 years.
  • Archer Daniels Midland had a poor average operating margin of 2.5% over the last 4 quarters.
  • Archer Daniels Midland posted a TTM Net margin of 2.6%.
  • Cash flow from operations is low at 0.1 times the net income.
  • The company has a negative free cash flow margin of -1.7%.

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Comments on this video and Archer Daniels Midland stock

Amigobulls Archer Daniels Midland stock analysis helps in evaluating the financial statements of a company to arrive at a conclusion about the fair value of ADM stock. The fundamentals of a company are vital to identify long-term investment opportunities.

Archer Daniels Midland revenue growth is an indicator of the demand for a company's products while profit margin is indicative of company's pricing power and pricing strategy. Investors could make use of ADM technical analysis to check whether the fundamental story is reflected in the market sentiment.