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Is NYSE:ADM a Good Fit for Dividend Investing?

By Mill Chart

Last update: Apr 18, 2024

Our stock screener has spotted ARCHER-DANIELS-MIDLAND CO (NYSE:ADM) as a good dividend stock with solid fundamentals. NYSE:ADM shows decent health and profitability. At the same time it gives a good and sustainable dividend. We'll dive into each aspect below.

Dividend Insights: NYSE:ADM

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NYSE:ADM has been assigned a 7 for dividend:

  • Compared to an average industry Dividend Yield of 3.56, ADM pays a bit more dividend than its industry peers.
  • Compared to an average S&P500 Dividend Yield of 2.39, ADM pays a bit more dividend than the S&P500 average.
  • On average, the dividend of ADM grows each year by 6.30%, which is quite nice.
  • ADM has paid a dividend for at least 10 years, which is a reliable track record.
  • ADM has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
  • ADM pays out 28.05% of its income as dividend. This is a sustainable payout ratio.

What does the Health looks like for NYSE:ADM

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:ADM, the assigned 6 for health provides valuable insights:

  • ADM has an Altman-Z score of 3.42. This indicates that ADM is financially healthy and has little risk of bankruptcy at the moment.
  • With a decent Altman-Z score value of 3.42, ADM is doing good in the industry, outperforming 78.02% of the companies in the same industry.
  • The Debt to FCF ratio of ADM is 2.82, which is a good value as it means it would take ADM, 2.82 years of fcf income to pay off all of its debts.
  • ADM's Debt to FCF ratio of 2.82 is amongst the best of the industry. ADM outperforms 80.22% of its industry peers.
  • A Debt/Equity ratio of 0.35 indicates that ADM is not too dependend on debt financing.

Analyzing Profitability Metrics

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NYSE:ADM has achieved a 7:

  • Looking at the Return On Assets, with a value of 6.38%, ADM is in the better half of the industry, outperforming 73.63% of the companies in the same industry.
  • Looking at the Return On Equity, with a value of 14.43%, ADM belongs to the top of the industry, outperforming 81.32% of the companies in the same industry.
  • ADM's Return On Invested Capital of 9.23% is amongst the best of the industry. ADM outperforms 84.62% of its industry peers.
  • The 3 year average ROIC (8.63%) for ADM is below the current ROIC(9.23%), indicating increased profibility in the last year.
  • ADM has a Profit Margin of 3.71%. This is in the better half of the industry: ADM outperforms 63.74% of its industry peers.
  • ADM's Profit Margin has improved in the last couple of years.
  • ADM's Operating Margin of 4.32% is fine compared to the rest of the industry. ADM outperforms 60.44% of its industry peers.
  • ADM's Operating Margin has improved in the last couple of years.
  • In the last couple of years the Gross Margin of ADM has grown nicely.

Our Best Dividend screener lists more Best Dividend stocks and is updated daily.

Our latest full fundamental report of ADM contains the most current fundamental analsysis.

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.

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ARCHER-DANIELS-MIDLAND CO

NYSE:ADM (5/24/2024, 7:12:30 PM)

After market: 60.49 0 (0%)

60.49

-0.23 (-0.38%)

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