What to Expect When Monsanto (MON) Reports Earnings Results Tomorrow

NEW YORK (TheStreet) --Monsanto (MON) is scheduled to release its 2015 third quarter earnings results before the market open on Wednesday morning. Analysts are expecting the company, which supplies farmers with agricultural products, to post a year-over-year rise in earnings and revenue for the quarter.

The company has been forecast to report earnings of $2.06 per share on revenue of $4.60 billion for the quarter ended May 2015.

Last year, Monsanto said it earned $1.62 per diluted share on total sales of $4.25 billion for the 2014 third quarter.

Shares of Monsanto are down by 0.26% to $114.04 at the start of trading on Tuesday morning.

Earlier today, Monsanto's offer to take over the agribusiness Syngenta (SYT) was once again refused. The Swiss company believes Monsanto's $45 billion offer undervalues its business, The Wall Street Journal reports.

Separately, TheStreet Ratings team rates MONSANTO CO as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate MONSANTO CO (MON) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its expanding profit margins, good cash flow from operations, notable return on equity, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. We feel its strengths outweigh the fact that the company has had lackluster performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The gross profit margin for MONSANTO CO is rather high; currently it is at 61.94%. Regardless of MON's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, MON's net profit margin of 27.41% significantly outperformed against the industry.
  • Net operating cash flow has increased to $169.00 million or 14.18% when compared to the same quarter last year. Despite an increase in cash flow of 14.18%, MONSANTO CO is still growing at a significantly lower rate than the industry average of 101.57%.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. In comparison to other companies in the Chemicals industry and the overall market on the basis of return on equity, MONSANTO CO has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
  • MONSANTO CO's earnings per share declined by 7.9% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, MONSANTO CO increased its bottom line by earning $5.13 versus $4.56 in the prior year. This year, the market expects an improvement in earnings ($5.76 versus $5.13).
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 14.7%. Since the same quarter one year prior, revenues fell by 10.9%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • You can view the full analysis from the report here: MON Ratings Report

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