Earnings Preview: Archer Daniels Midland

Archer Daniels Midland Company (ADM) is expected to report Q1 earnings before market open Tuesday, Nov. 4 with a conference call scheduled for 9:00 am ET.

Guidance

Analysts are looking for EPS of 69c on revenue of $15.98B. The consensus range is 55c to 82c for EPS, and $13.0B to $19.88B for revenue, according to First Call.

Analyst Views

Last quarter, Archer Daniels underperformed on EPS, posting Q4 EPS of 58c vs. a consensus of 67c, but outperformed on revenue, posting Q4 revenue of $21.8B vs. a consensus of $$16.03B. During the call, when asked about guidance for 2009, the company said, "As you know, we don't give guidance and I don't think we gave guidance today. " However, in October, the company did increase its crop production projections for 2008-2009, forecasting a wheat production increase of 65M tons, an oil seed production increase of 27M tons, and a coarse grains production increase of 11M tons.

Recent analyst commentary has been positive. Merrill Lynch upgrading ADM to Buy from Neutral on October 18, citing the 40% reduction in commodity prices. BMO Capital upgraded ADM to Outperform from Market Perform on October 20, based on valuation. Most recently, Soleil initiated ADM with a Buy on October 28, saying longer term investors should buy the stock at these "trough" valuation levels.

Comments

[lefty37:]

There is one commodity people will buy in any market-------FOOD!

2008 Nov 04 11:57 AM