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1. Company Snapshot

1.a. Company Description

Archer-Daniels-Midland Company procures, transports, stores, processes, and merchandises agricultural commodities, products, and ingredients in the United States, Switzerland, Cayman Islands, Brazil, Mexico, the United Kingdom, and internationally.The company operates through three segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition.It procures, stores, cleans, and transports agricultural raw materials, such as oilseeds, corn, wheat, milo, oats, and barley.


The company also engages in the agricultural commodity and feed product import, export, and distribution; and structured trade finance activities.In addition, it offers vegetable oils and protein meals; ingredients for the food, feed, energy, and industrial customers; crude vegetable oils, salad oils, margarine, shortening, and other food products; and partially refined oils to produce biodiesel and glycols for use in chemicals, paints, and other industrial products.Further, the company provides peanuts, peanut-derived ingredients, and cotton cellulose pulp; sweeteners, corn and wheat starches, syrup, glucose, wheat flour, and dextrose; alcohol and other food and animal feed ingredients; ethyl alcohol and ethanol; corn gluten feed and meal; distillers' grains; and citric acids.


Additionally, the company provides natural flavors, flavor systems, natural colors, proteins, emulsifiers, soluble fiber, polyols, hydrocolloids, and natural health and nutrition products, including probiotics, prebiotics, enzymes, and botanical extracts; and other specialty food and feed ingredients; edible beans; formula feeds, and animal health and nutrition products; and contract and private label pet treats and foods.It also offers futures commission merchant; commodity brokerage services; cash margins and securities pledged to commodity exchange clearinghouses; and cash pledged as security under certain insurance arrangements.The company was founded in 1902 and is headquartered in Chicago, Illinois.

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1.b. Last Insights on ADM

Archer-Daniels-Midland's recent performance was negatively impacted by a lower-than-expected revenue and a decline in EPS. The company's Q3 earnings report revealed a significant drop in EPS to $0.22, compared to $1.09 a year ago. Additionally, the company faces margin and demand headwinds in Ag Services and Oilseeds. An ongoing investigation into the company's Nutrition segment also raises concerns. The company's lowered 2025 profit outlook further adds to the negative sentiment.

1.c. Company Highlights

2. ADM's Q3 Earnings: A Mixed Bag

Archer-Daniels-Midland Company (ADM) reported adjusted earnings per share of $0.92 for the third quarter, with total segment operating profit of $845 million. The company's trailing 4-quarter adjusted ROIC was 6.7%, and cash flow from operations before working capital changes was $2.1 billion year-to-date. The actual EPS came out at $0.92, which is slightly higher than the estimated $0.88. Revenue growth was not explicitly stated, but the company's Nutrition segment saw a 5% increase in revenues compared to the prior year quarter.

Publication Date: Nov -05

📋 Highlights
  • Adjusted EPS & Profit: ADM reported Q3 adjusted EPS of $0.92, with total segment operating profit of $845 million, driven by strong cash flow ($2.1B YTD).
  • AS&O Segment Performance: Operating profit fell 21% to $379M YoY, but Ag Services subsegment rose 78% to $190M due to higher North American export activity.
  • Carbohydrate Solutions: Profit dropped 26% to $336M YoY, offset by ethanol pricing gains and exports amid declining global sweetener/starch demand.
  • Nutrition Growth: Revenues hit $1.9B (+5% YoY), with operating profit up 24% to $130M, driven by Flavors & Animal Nutrition portfolios.
  • 2025 Guidance Cut: Full-year adjusted EPS guidance reduced to $3.25–$3.50 from $4, citing biofuel policy delays and trade uncertainty impacting margins.

Segment Performance

The Ag Services and Oilseeds (AS&O) segment operating profit was $379 million, down 21% compared to the prior year quarter. The Carbohydrate Solutions segment operating profit was $336 million, down 26% compared to the prior year quarter, primarily due to a decline in global sweeteners and starches demand. The Nutrition segment operating profit was $130 million, up 24% compared to the prior year quarter, driven by the Flavors and Animal Nutrition portfolios.

Valuation Metrics

Using the current stock price and the company's financials, we can calculate various valuation metrics. The P/E Ratio is 24.47, indicating that the stock is trading at a premium to its earnings. The EV/EBITDA ratio is 11.12, which is relatively moderate. The Dividend Yield is 3.38%, providing a relatively stable source of return. The ROIC is 4.87%, and the ROE is 5.33%, indicating that the company is generating returns on its investments and equity.

Outlook and Expectations

ADM expects 2026 to offer a more constructive environment for the industry and the American farmer, driven by progress on US biofuel policy and trade deals. The company expects adjusted earnings per share to be between $3.25 to $3.50 for full year 2025, down from the approximate $4 per share guide provided during the second quarter earnings. Analysts estimate next year's revenue growth at 3.8%. The company's guidance suggests a more challenging environment in the near term, but with potential upside in the longer term.

Operational Highlights

ADM is focusing on operational excellence, with a emphasis on manufacturing efficiencies, portfolio simplification, and cost streamlining. The company is positioning its asset network to maximize opportunities from expected improvements in market conditions, particularly in the AS&O segment. The Nutrition business is experiencing seasonal headwinds, but is also seeing operational improvements. As Juan Luciano mentioned, "we will continue to drive operational excellence and strong cash flow through our focus on manufacturing efficiencies, portfolio simplification, and cost streamlining."

3. NewsRoom

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Archer-Daniels-Midland Company (ADM) Presents at Goldman Sachs Industrials and Materials Conference 2025 Transcript

Dec -03

Source: seekingalpha.com

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American Century Companies Inc. Has $18.80 Million Stock Holdings in Archer Daniels Midland Company $ADM

Dec -03

Source: defenseworld.net

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Best Dividend Aristocrats For December 2025

Nov -29

Source: seekingalpha.com

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ADM to Present at 2025 Goldman Sachs Industrials & Materials Conference

Nov -24

Source: businesswire.com

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Barings LLC Decreases Position in Archer Daniels Midland Company $ADM

Nov -23

Source: defenseworld.net

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Archer-Daniels-Midland: Despite Another Guidance Cut In Q3, It Shows Resilience

Nov -20

Source: seekingalpha.com

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Buy 3 Ideal Dividend Kings Of 24 'Safer' In November's 56

Nov -10

Source: seekingalpha.com

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ADM, Tallgrass Celebrate Opening of World's Largest Bioethanol Carbon Capture Facility in Columbus, Nebraska

Nov -10

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.57%)

6. Segments

AG Services and Oilseeds

Expected Growth: 4.5%

Archer-Daniels-Midland Company’s AG Services and Oilseeds segment is expected to grow driven by increasing demand for biofuels, rising global food consumption, and growth in the animal nutrition market.

Carbohydrate Solutions

Expected Growth: 4.5%

Increasing demand for healthier food options and rising popularity of clean label products drive growth in Archer-Daniels-Midland’s carbohydrate solutions segment.

Nutrition

Expected Growth: 5.3%

None

Other

Expected Growth: 4.2%

Archer-Daniels-Midland Company’s other segment benefits from growing demand for alternative energy sources, increasing adoption of sustainable agricultural practices, and rising global food security concerns.

Intersegment Elimination

Expected Growth: 4.3%

Eliminating intercompany transactions will enhance operational efficiency and reduce costs, driving growth. Strengthened cash flow will enable investments in high-growth areas, such as plant-based proteins and specialty ingredients, further boosting sales.

7. Detailed Products

Oilseeds

Archer-Daniels-Midland Company is a leading processor of oilseeds such as soybeans, sunflower seeds, and canola, which are used to produce vegetable oils and protein meal.

Corn Processing

The company converts corn into various products such as ethanol, corn syrup, and high-fructose corn syrup, which are used in food, beverages, and biofuels.

Wild Flavors and Specialty Ingredients

Archer-Daniels-Midland Company offers a range of natural flavor ingredients, specialty proteins, and emulsifiers used in food, beverages, and personal care products.

Agricultural Services

The company provides agricultural services such as grain merchandising, transportation, and storage to farmers, processors, and other customers.

Wheat and Milling

Archer-Daniels-Midland Company is a leading processor of wheat, producing flour, bakery mixes, and other wheat-based products for the baking industry.

8. Archer-Daniels-Midland Company's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Archer-Daniels-Midland Company is medium due to the availability of alternative products in the market, but the company's strong brand presence and quality products reduce the threat.

Bargaining Power Of Customers

The bargaining power of customers is low due to the company's strong distribution network and the lack of concentration of buyers in the market.

Bargaining Power Of Suppliers

The bargaining power of suppliers is medium due to the presence of few large suppliers in the market, but the company's strong relationships with suppliers reduce the threat.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the industry, including high capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of several large players in the market, leading to intense competition and pricing pressures.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 26.42%
Debt Cost 7.85%
Equity Weight 73.58%
Equity Cost 7.85%
WACC 7.85%
Leverage 35.91%

11. Quality Control: Archer-Daniels-Midland Company passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Momentum: 8.5

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Cal-Maine Foods

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CHS

A-Score: 6.2/10

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Archer-Daniels-Midland

A-Score: 5.8/10

Value: 6.5

Growth: 4.6

Quality: 4.0

Yield: 6.0

Momentum: 6.0

Volatility: 8.0

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Quality: 3.8

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

59.01$

Current Price

59.01$

Potential

-0.00%

Expected Cash-Flows