Archer-Daniels Midland Co

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ADM : NYSE : Consumer Goods
$41.3 | %
Today's Range: 0.0 - 0.0
Avg. Daily Volume: 2856700.0
06/26/17 - 4:00 PM ET

Financial Analysis


ARCHER-DANIELS-MIDLAND CO's gross profit margin for the first quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. The company managed to grow both sales and net income at a faster pace than the average competitor in its industry this quarter as compared to the same quarter a year ago. ARCHER-DANIELS-MIDLAND CO has weak liquidity. Currently, the Quick Ratio is 0.76 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 4.34% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY17 Q1 FY16
Net Sales ($mil)14988.014384.0
EBITDA ($mil)572.0533.0
EBIT ($mil)347.0302.0
Net Income ($mil)339.0230.0


Balance Sheet Q1 FY17 Q1 FY16
Cash & Equiv. ($mil)6124.06502.0
Total Assets ($mil)39630.039681.0
Total Debt ($mil)7207.06646.0
Equity ($mil)17121.017899.0


Profitability Q1 FY17 Q1 FY16
Gross Profit Margin7.297.04
EBITDA Margin3.813.7
Operating Margin2.322.1
Sales Turnover1.591.63
Return on Assets3.53.99
Return on Equity8.18.86
Debt Q1 FY17 Q1 FY16
Current Ratio1.511.63
Debt/Capital0.30.27
Interest Expense81.070.0
Interest Coverage4.284.31


Share Data Q1 FY17 Q1 FY16
Shares outstanding (mil)569.0587.0
Div / share0.320.3
EPS0.590.39
Book value / share30.0930.49
Institutional Own % n/a n/a
Avg Daily Volume2823314.03261997.0

Valuation


BUY. The current P/E ratio indicates a significant discount compared to an average of 30.60 for the Food Products industry and a discount compared to the S&P 500 average of 25.75. For additional comparison, its price-to-book ratio of 1.36 indicates a significant discount versus the S&P 500 average of 3.09 and a significant discount versus the industry average of 4.78. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, ARCHER-DANIELS-MIDLAND CO proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ADM 17.24 Peers 30.60   ADM 12.61 Peers 18.20

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ADM is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ADM is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ADM 13.77 Peers 20.27   ADM 0.75 Peers 2.42

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

ADM is trading at a discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ADM trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ADM 1.36 Peers 4.78   ADM -8.82 Peers 62.55

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ADM is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, ADM is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ADM 0.37 Peers 2.31   ADM -2.53 Peers 3.47

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ADM is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ADM significantly trails its peers on the basis of sales growth

 

 

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