ARCHER-DANIELS-MIDLAND CO (ADM) Stock Fundamental Analysis
NYSE:ADM - New York Stock Exchange, Inc. - US0394831020 - Common Stock - Currency: USD
Overall ADM gets a fundamental rating of 4 out of 10. We evaluated ADM against 90 industry peers in the Food Products industry. ADM has an average financial health and profitability rating. ADM is valued correctly, but it does not seem to be growing. Finally ADM also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
ADM had positive earnings in the past year.
In the past year ADM had a positive cash flow from operations.
ADM had positive earnings in each of the past 5 years.
ADM had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
ADM has a Return On Assets (2.56%) which is in line with its industry peers.
ADM's Return On Equity of 6.18% is in line compared to the rest of the industry. ADM outperforms 53.33% of its industry peers.
The Return On Invested Capital of ADM (3.57%) is comparable to the rest of the industry.
ADM had an Average Return On Invested Capital over the past 3 years of 7.66%. This is in line with the industry average of 8.63%.
The last Return On Invested Capital (3.57%) for ADM is well below the 3 year average (7.66%), which needs to be investigated, but indicates that ADM had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.56% | ||
| ROE | 6.18% | ||
| ROIC | 3.57% |
ROA(3y)5.67%
ROA(5y)5.08%
ROE(3y)13.47%
ROE(5y)12.27%
ROIC(3y)7.66%
ROIC(5y)6.81%
1.3 Margins
The Profit Margin of ADM (1.63%) is comparable to the rest of the industry.
ADM's Profit Margin has been stable in the last couple of years.
The Operating Margin of ADM (1.92%) is worse than 61.11% of its industry peers.
ADM's Operating Margin has been stable in the last couple of years.
ADM has a Gross Margin of 6.32%. This is amonst the worse of the industry: ADM underperforms 81.11% of its industry peers.
In the last couple of years the Gross Margin of ADM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.92% | ||
| PM (TTM) | 1.63% | ||
| GM | 6.32% |
OM growth 3Y-12%
OM growth 5Y-1.08%
PM growth 3Y-12.83%
PM growth 5Y-0.27%
GM growth 3Y-1.29%
GM growth 5Y1.04%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ADM is destroying value.
The number of shares outstanding for ADM has been reduced compared to 1 year ago.
ADM has less shares outstanding than it did 5 years ago.
ADM has a worse debt/assets ratio than last year.
2.2 Solvency
ADM has an Altman-Z score of 2.86. This is not the best score and indicates that ADM is in the grey zone with still only limited risk for bankruptcy at the moment.
ADM's Altman-Z score of 2.86 is fine compared to the rest of the industry. ADM outperforms 67.78% of its industry peers.
The Debt to FCF ratio of ADM is 49.84, which is on the high side as it means it would take ADM, 49.84 years of fcf income to pay off all of its debts.
ADM has a Debt to FCF ratio of 49.84. This is comparable to the rest of the industry: ADM outperforms 45.56% of its industry peers.
ADM has a Debt/Equity ratio of 0.47. This is a healthy value indicating a solid balance between debt and equity.
ADM has a Debt to Equity ratio (0.47) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 49.84 | ||
| Altman-Z | 2.86 |
ROIC/WACC0.43
WACC8.3%
2.3 Liquidity
ADM has a Current Ratio of 1.38. This is a normal value and indicates that ADM is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.38, ADM is in line with its industry, outperforming 46.67% of the companies in the same industry.
ADM has a Quick Ratio of 1.38. This is a bad value and indicates that ADM is not financially healthy enough and could expect problems in meeting its short term obligations.
The Quick ratio of ADM (0.81) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.38 | ||
| Quick Ratio | 0.81 |
3. Growth
3.1 Past
ADM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -37.54%.
ADM shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 12.32% yearly.
The Revenue has decreased by -8.56% in the past year.
Measured over the past years, ADM shows a small growth in Revenue. The Revenue has been growing by 5.76% on average per year.
EPS 1Y (TTM)-37.54%
EPS 3Y-3.11%
EPS 5Y12.32%
EPS Q2Q%-52.05%
Revenue 1Y (TTM)-8.56%
Revenue growth 3Y0.11%
Revenue growth 5Y5.76%
Sales Q2Q%-7.65%
3.2 Future
Based on estimates for the next years, ADM will show a decrease in Earnings Per Share. The EPS will decrease by -0.83% on average per year.
ADM is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -0.59% yearly.
EPS Next Y-14.64%
EPS Next 2Y-1.76%
EPS Next 3Y0.58%
EPS Next 5Y-0.83%
Revenue Next Year-2.21%
Revenue Next 2Y0.23%
Revenue Next 3Y1.15%
Revenue Next 5Y-0.59%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 12.11, ADM is valued correctly.
74.44% of the companies in the same industry are more expensive than ADM, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 25.82, ADM is valued rather cheaply.
The Price/Forward Earnings ratio is 10.52, which indicates a very decent valuation of ADM.
Based on the Price/Forward Earnings ratio, ADM is valued cheaper than 86.67% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.76. ADM is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.11 | ||
| Fwd PE | 10.52 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as ADM.
The rest of the industry has a similar Price/Free Cash Flow ratio as ADM.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 103.69 | ||
| EV/EBITDA | 11.01 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)0.98
EPS Next 2Y-1.76%
EPS Next 3Y0.58%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.18%, ADM is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.59, ADM pays a better dividend. On top of this ADM pays more dividend than 83.33% of the companies listed in the same industry.
ADM's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.18% |
5.2 History
The dividend of ADM is nicely growing with an annual growth rate of 7.05%!
ADM has paid a dividend for at least 10 years, which is a reliable track record.
ADM has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.05%
Div Incr Years34
Div Non Decr Years34
5.3 Sustainability
ADM pays out 71.38% of its income as dividend. This is not a sustainable payout ratio.
ADM's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP71.38%
EPS Next 2Y-1.76%
EPS Next 3Y0.58%
47.94
-0.02 (-0.04%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupFood, Beverage & Tobacco
GICS IndustryFood Products
Earnings (Last)
Earnings (Next)
Inst Owners81.96%
Inst Owner Change2.52%
Ins Owners0.55%
Ins Owner Change7.16%
Market Cap23.02B
Analysts51.58
Price Target50.55 (5.44%)
Short Float %2.89%
Short Ratio2.92
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.18% |
Yearly Dividend1.99
Dividend Growth(5Y)7.05%
DP71.38%
Div Incr Years34
Div Non Decr Years34
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.85%
Min EPS beat(2)-1.69%
Max EPS beat(2)3.39%
EPS beat(4)1
Avg EPS beat(4)-6.95%
Min EPS beat(4)-16.17%
Max EPS beat(4)3.39%
EPS beat(8)4
Avg EPS beat(8)-0.52%
EPS beat(12)8
Avg EPS beat(12)6.66%
EPS beat(16)12
Avg EPS beat(16)9.91%
Revenue beat(2)0
Avg Revenue beat(2)-7.52%
Min Revenue beat(2)-8.97%
Max Revenue beat(2)-6.07%
Revenue beat(4)0
Avg Revenue beat(4)-6.88%
Min Revenue beat(4)-8.97%
Max Revenue beat(4)-4.96%
Revenue beat(8)0
Avg Revenue beat(8)-5.89%
Revenue beat(12)3
Avg Revenue beat(12)-2.51%
Revenue beat(16)7
Avg Revenue beat(16)1.7%
PT rev (1m)-3.47%
PT rev (3m)-10.4%
EPS NQ rev (1m)-15.08%
EPS NQ rev (3m)-15.98%
EPS NY rev (1m)-3.92%
EPS NY rev (3m)-5.63%
Revenue NQ rev (1m)-6.31%
Revenue NQ rev (3m)-6.32%
Revenue NY rev (1m)-4.45%
Revenue NY rev (3m)-4.52%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.11 | ||
| Fwd PE | 10.52 | ||
| P/S | 0.27 | ||
| P/FCF | 103.69 | ||
| P/OCF | 13.17 | ||
| P/B | 1.04 | ||
| P/tB | 1.51 | ||
| EV/EBITDA | 11.01 |
EPS(TTM)3.96
EY8.26%
EPS(NY)4.56
Fwd EY9.5%
FCF(TTM)0.46
FCFY0.96%
OCF(TTM)3.64
OCFY7.59%
SpS174.65
BVpS46.07
TBVpS31.75
PEG (NY)N/A
PEG (5Y)0.98
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.56% | ||
| ROE | 6.18% | ||
| ROCE | 4.85% | ||
| ROIC | 3.57% | ||
| ROICexc | 3.67% | ||
| ROICexgc | 4.56% | ||
| OM | 1.92% | ||
| PM (TTM) | 1.63% | ||
| GM | 6.32% | ||
| FCFM | 0.26% |
ROA(3y)5.67%
ROA(5y)5.08%
ROE(3y)13.47%
ROE(5y)12.27%
ROIC(3y)7.66%
ROIC(5y)6.81%
ROICexc(3y)7.91%
ROICexc(5y)7.02%
ROICexgc(3y)9.73%
ROICexgc(5y)8.63%
ROCE(3y)9.78%
ROCE(5y)8.76%
ROICexcg growth 3Y-12.07%
ROICexcg growth 5Y2.66%
ROICexc growth 3Y-12.06%
ROICexc growth 5Y2.21%
OM growth 3Y-12%
OM growth 5Y-1.08%
PM growth 3Y-12.83%
PM growth 5Y-0.27%
GM growth 3Y-1.29%
GM growth 5Y1.04%
F-Score5
Asset Turnover1.57
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.47 | ||
| Debt/FCF | 49.84 | ||
| Debt/EBITDA | 3.75 | ||
| Cap/Depr | 132.93% | ||
| Cap/Sales | 1.82% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 63.33% | ||
| Profit Quality | 16.25% | ||
| Current Ratio | 1.38 | ||
| Quick Ratio | 0.81 | ||
| Altman-Z | 2.86 |
F-Score5
WACC8.3%
ROIC/WACC0.43
Cap/Depr(3y)135.46%
Cap/Depr(5y)121.61%
Cap/Sales(3y)1.57%
Cap/Sales(5y)1.47%
Profit Quality(3y)67.69%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-37.54%
EPS 3Y-3.11%
EPS 5Y12.32%
EPS Q2Q%-52.05%
EPS Next Y-14.64%
EPS Next 2Y-1.76%
EPS Next 3Y0.58%
EPS Next 5Y-0.83%
Revenue 1Y (TTM)-8.56%
Revenue growth 3Y0.11%
Revenue growth 5Y5.76%
Sales Q2Q%-7.65%
Revenue Next Year-2.21%
Revenue Next 2Y0.23%
Revenue Next 3Y1.15%
Revenue Next 5Y-0.59%
EBIT growth 1Y-54.8%
EBIT growth 3Y-11.91%
EBIT growth 5Y4.61%
EBIT Next Year90.48%
EBIT Next 3Y28.08%
EBIT Next 5Y16.03%
FCF growth 1Y-86.5%
FCF growth 3Y-39.08%
FCF growth 5YN/A
OCF growth 1Y-43.14%
OCF growth 3Y-24.93%
OCF growth 5YN/A