Monsanto, with a market value of $45 billion, produces leading seed brands and develops biotechnology traits that assist farmers in controlling insects and weeds, and provides other seed companies with genetic material and biotech traits. Its Roundup herbicides are used for agricultural, industrial and residential weed control. Seeds and genomics made up 73% of sales and 87% of gross profits in its 2011 fiscal year.
Its shares are up 23% this year, including 11.6% over the past three months, and have a three-year, average annual return of 5.5%. Over 10 years the average return is an amazing 28% annually.
Analysts give its shares eight "buy" ratings, six "buy/holds" and eight "holds," according to a survey of analysts by S&P. For fiscal year 2012, analysts' consensus earnings estimate is for $3.74 per share, and that that will grow 15% to $4.29 per share next year.
Standard & Poor's says, "Monsanto's shares trade at a valuation premium to the S&P 500, reflecting what we see as above average earnings growth prospects. We forecast primary contributors being the introduction of next-generation seeds, and increased trait penetration in international markets, like South America."
E.I. du Pont de Nemours
DuPont, with a market value of $45 billion, is a broadly diversified company, and known chiefly as the second-largest U.S. chemicals manufacturer. Its agricultural segment, which made up 24% of sales in 2011 and $1.5 billion of operating profit, includes Pioneer HiBred, the world's largest seed company, including corn and soybeans. The company is also a major global supplier of crop protection chemicals.
Its shares are up 5.7% this year and have a three-year, average annual return of 24%. Analysts give its shares four "buy" ratings, four "buy/holds" and 13 "holds," according to a survey of analysts by S&P, with the "holds" reflecting valuation concerns.
For fiscal year 2012, analysts' consensus estimate calls for earnings of $4.26 per share, (up 16% over the prior year), and analysts estimate that earnings per share will grow by 11% to $4.72 in 2013. Morningstar says DuPont's genetically modified seed business should "account for the lion's share of future growth for the company in both North America and emerging markets."
Syngenta, a Swiss firm with a market value of $30 billion, operates worldwide selling crop protection in the form of herbicides, insecticides and fungicides, as well as a developer of a wide variety of seeds. Among its latest products is Invinsa, which is the first spray-on product to protect field crops from drought.
Its shares are up 15% this year and have a three-year, average annual return of 13%. Analysts give its shares one "buy" rating and six "holds," according to a survey of analysts by S&P.
For fiscal year 2012, analysts estimate it will earn $4.34 (up 25% year-over-year) and that that will grow by 13% to $4.89 per share next year. Morningstar analysts say that "with competitors concentrating on corn and soybeans, Syngenta has gained a solid position in the vegetable seeds market. The company expects this segment to grow as emerging regions demand more high-value vegetables in their diets."