Best Dividend Stocks. Analyze the stocks with the best dividend, while also showing decent profitability and health.


ARCHER-DANIELS-MIDLAND CO

New York Stock Exchange, Inc. / Consumer Staples / Food Products

Fundamental Rating

5

ADM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 92 industry peers in the Food Products industry. ADM is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. ADM is cheap, but on the other hand it scores bad on growth. ADM also has an excellent dividend rating. These ratings could make ADM a good candidate for value and dividend investing.



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1. Profitability

1.1 Basic Checks

ADM had positive earnings in the past year.
ADM had a positive operating cash flow in the past year.
Each year in the past 5 years ADM has been profitable.
In multiple years ADM reported negative operating cash flow during the last 5 years.

1.2 Ratios

ADM's Return On Assets of 8.26% is amongst the best of the industry. ADM outperforms 83.52% of its industry peers.
With a decent Return On Equity value of 13.09%, ADM is doing good in the industry, outperforming 69.23% of the companies in the same industry.
The Return On Invested Capital of ADM (7.94%) is better than 79.12% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ADM is in line with the industry average of 7.59%.
Industry RankSector Rank
ROA 8.26%
ROE 13.09%
ROIC 7.94%
ROA(3y)6.15%
ROA(5y)5.03%
ROE(3y)14.79%
ROE(5y)12.08%
ROIC(3y)8.63%
ROIC(5y)6.9%

1.3 Margins

ADM has a Profit Margin (3.32%) which is in line with its industry peers.
ADM's Profit Margin has improved in the last couple of years.
ADM has a Operating Margin (3.89%) which is in line with its industry peers.
In the last couple of years the Operating Margin of ADM has grown nicely.
The Gross Margin of ADM (7.73%) is worse than 72.53% of its industry peers.
In the last couple of years the Gross Margin of ADM has grown nicely.
Industry RankSector Rank
OM 3.89%
PM (TTM) 3.32%
GM 7.73%
OM growth 3Y16.32%
OM growth 5Y6.63%
PM growth 3Y10.43%
PM growth 5Y5.68%
GM growth 3Y4.95%
GM growth 5Y4.24%

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7

2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ADM is destroying value.
ADM has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, ADM has less shares outstanding
The debt/assets ratio for ADM has been reduced compared to a year ago.

2.2 Solvency

ADM has a debt to FCF ratio of 1.89. This is a very positive value and a sign of high solvency as it would only need 1.89 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.89, ADM belongs to the best of the industry, outperforming 83.52% of the companies in the same industry.
A Debt/Equity ratio of 0.43 indicates that ADM is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.43, ADM is in line with its industry, outperforming 51.65% of the companies in the same industry.
Industry RankSector Rank
Debt/Equity 0.43
Debt/FCF 1.89
Altman-Z N/A
ROIC/WACC0.92
WACC8.67%

2.3 Liquidity

A Current Ratio of 6.35 indicates that ADM has no problem at all paying its short term obligations.
The Current ratio of ADM (6.35) is better than 98.90% of its industry peers.
A Quick Ratio of 6.35 indicates that ADM has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 6.35, ADM belongs to the best of the industry, outperforming 98.90% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 6.35
Quick Ratio 6.35

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1

3. Growth

3.1 Past

The earnings per share for ADM have decreased strongly by -21.05% in the last year.
ADM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 14.77% yearly.
The Revenue for ADM has decreased by -10.07% in the past year. This is quite bad
Measured over the past years, ADM shows a small growth in Revenue. The Revenue has been growing by 7.86% on average per year.
EPS 1Y (TTM)-21.05%
EPS 3Y24.75%
EPS 5Y14.77%
EPS growth Q2Q-30.14%
Revenue 1Y (TTM)-10.07%
Revenue growth 3Y13.44%
Revenue growth 5Y7.86%
Revenue growth Q2Q-9.24%

3.2 Future

ADM is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -8.02% yearly.
ADM is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -1.16% yearly.
EPS Next Y-18.99%
EPS Next 2Y-8.96%
EPS Next 3Y-5.69%
EPS Next 5Y-8.02%
Revenue Next Year-3.97%
Revenue Next 2Y-0.94%
Revenue Next 3Y-0.83%
Revenue Next 5Y-1.16%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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7

4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 9.36 indicates a reasonable valuation of ADM.
Compared to the rest of the industry, the Price/Earnings ratio of ADM indicates a rather cheap valuation: ADM is cheaper than 95.60% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 28.06. ADM is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 10.27, the valuation of ADM can be described as reasonable.
Based on the Price/Forward Earnings ratio, ADM is valued cheaply inside the industry as 93.41% of the companies are valued more expensively.
ADM's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 20.72.
Industry RankSector Rank
PE 9.36
Fwd PE 10.27

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ADM indicates a rather cheap valuation: ADM is cheaper than 84.62% of the companies listed in the same industry.
ADM's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ADM is cheaper than 92.31% of the companies in the same industry.
Industry RankSector Rank
P/FCF 5.65
EV/EBITDA 7.9

4.3 Compensation for Growth

The decent profitability rating of ADM may justify a higher PE ratio.
ADM's earnings are expected to decrease with -5.69% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.63
EPS Next 2Y-8.96%
EPS Next 3Y-5.69%

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7

5. Dividend

5.1 Amount

ADM has a Yearly Dividend Yield of 3.43%.
ADM's Dividend Yield is rather good when compared to the industry average which is at 3.53. ADM pays more dividend than 85.71% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.41, ADM pays a bit more dividend than the S&P500 average.
Industry RankSector Rank
Dividend Yield 3.43%

5.2 History

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.
Dividend Growth(5Y)6.3%
Div Incr Years19
Div Non Decr Years19

5.3 Sustainability

32.41% of the earnings are spent on dividend by ADM. This is a low number and sustainable payout ratio.
DP32.41%
EPS Next 2Y-8.96%
EPS Next 3Y-5.69%

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