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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

The recent 3-month performance of Archer Daniels Midland Company (ADM) was driven by strong Q4 2025 earnings and revenue beat, as well as a solid guidance for 2026. The company's adjusted net earnings of $422 million and adjusted EPS of $0.87 surpassed Wall Street estimates, indicating a resilient performance despite margin pressure in Ag Services, Oilseeds and Carbohydrates. Additionally, ADM's management emphasized tighter execution, working capital improvements, and a more constructive operating environment in 2026, providing a positive outlook for the company.

1.c. Company Highlights

2. ADM Posts Strong Q4 Earnings, Driven by Operational Efficiency

Archer-Daniels-Midland Company (ADM) reported adjusted earnings per share of $0.87 for the fourth quarter, beating analyst estimates of $0.797. The company's total segment operating profit was $821 million for the quarter and $3.2 billion for the full year. The strong performance was driven by operational efficiency, with the company realizing a $1.5 billion cash flow benefit from inventory reduction. Revenue growth was not explicitly stated, but analysts estimate next year's revenue growth at 6.4%. The company's financial performance was also reflected in its cash flow generation, with cash flow from operations before working capital of approximately $2.7 billion.

Publication Date: Feb -04

📋 Highlights
  • Adjusted EPS Growth: Full-year adjusted earnings per share rose to $3.43 (up from $3.23 in 2024), driven by $3.2 billion in total segment operating profit.
  • Working Capital Efficiency: Inventory reductions generated $1.5 billion in cash flow, supporting liquidity despite $600 million decline in operating cash flow before working capital in 2025.
  • Segment Declines: AS & O profits fell 34% YoY ($1.6 billion in 2025 vs. $2.4 billion in 2024), with Nutrition and Carbohydrate Solutions also down 11–12% due to market challenges.
  • 2026 Outlook: Guidance of $3.60–$4.25 adjusted EPS hinges on RVO policy clarity, ethanol exports, and improved crush margins, with Nutrition expected to recover via special ingredients growth.
  • Strategic Investments: Over 20 portfolio optimization projects in 2025 restored plant efficiency (e.g., Decatur East) and advanced growth platforms like biosolutions and precision fermentation.

Segment Performance

The Ag Services and Oilseeds (AS&O) segment operating profit was $444 million for the fourth quarter, down 31% compared to the prior year quarter. The Carbohydrate Solutions segment operating profit was $299 million, down 6% compared to the prior year quarter. The Nutrition segment operating profit was $178 million, down 11% compared to the prior year quarter. The decline in segment operating profit was largely due to challenging operating conditions, including low overall total segment operating profit.

Outlook and Guidance

ADM provided its current outlook for 2026, with an adjusted EPS range of $3.60 to $4.25 for the full year. The company's view is highly predicated on several key factors, including the timing of when it receives US biofuel policy clarity, the size of the RVO requirement, and the SRE offset. The company expects robust ethanol export opportunities to continue, driven by mandated markets, and domestic demand to strengthen with US biofuel policy clarity.

Valuation

Based on the current stock price, ADM's P/E Ratio is 30.26, indicating that the stock may be slightly overvalued. However, the company's Dividend Yield is 3.03%, which is attractive for income investors. Additionally, the EV/EBITDA ratio is 13.34, which is relatively low compared to industry peers. These valuation metrics suggest that the stock may be reasonably priced, considering its growth prospects and dividend yield.

Growth Initiatives

ADM is leveraging its assets and expertise to build out its operations in enhanced nutrition, biotics, biosolutions, precision fermentation, and decarbonization. The company expects these growth platforms to drive growth over the next five years. As Monish Patolawala mentioned, "We are leveraging our assets and expertise along with technology to build out our operations in enhanced nutrition, biotics, biosolutions, precision fermentation, and decarbonization." This strategic focus is expected to drive long-term value creation for shareholders.

3. NewsRoom

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ADM to present at the BofA Securities 2026 Global Agriculture & Materials Conference

Feb -11

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Is Nutrition Still a Growth Engine for ADM Amid Demand Shifts?

Feb -09

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40,453 Shares in Archer Daniels Midland Company $ADM Bought by Legacy Financial Strategies LLC

Feb -09

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ProShare Advisors LLC Reduces Holdings in Archer Daniels Midland Company $ADM

Feb -09

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Archer Daniels Midland Q4 Earnings Call Highlights

Feb -05

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Archer-Daniels-Midland: Dividend King Stability Meets Biofuel Policy Uncertainty

Feb -05

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Archer-Daniels-Midland Co (ADM) Q4 2025 Earnings Call Highlights: Navigating Challenges with Strategic Optimizations

Feb -03

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Archer-Daniels-Midland Company (ADM) Q4 2025 Earnings Call Transcript

Feb -03

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

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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Altria

A-Score: 7.6/10

Value: 6.8

Growth: 5.8

Quality: 6.5

Yield: 10.0

Momentum: 7.0

Volatility: 9.7

1-Year Total Return ->

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Cal-Maine Foods

A-Score: 7.5/10

Value: 8.5

Growth: 9.4

Quality: 7.8

Yield: 10.0

Momentum: 3.0

Volatility: 6.0

1-Year Total Return ->

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CHS

A-Score: 6.7/10

Value: 6.3

Growth: 5.2

Quality: 3.6

Yield: 10.0

Momentum: 5.0

Volatility: 10.0

1-Year Total Return ->

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Bunge

A-Score: 6.3/10

Value: 8.6

Growth: 5.6

Quality: 3.9

Yield: 6.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

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Archer-Daniels-Midland

A-Score: 6.2/10

Value: 6.4

Growth: 4.6

Quality: 3.9

Yield: 7.0

Momentum: 7.5

Volatility: 8.0

1-Year Total Return ->

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Kraft Heinz

A-Score: 6.1/10

Value: 8.9

Growth: 3.8

Quality: 4.3

Yield: 9.0

Momentum: 1.5

Volatility: 9.3

1-Year Total Return ->

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

69.3$

Current Price

69.3$

Potential

-0.00%

Expected Cash-Flows