Olivier Le Moal Author's Note: This is our monthly series on Dividend Stocks, usually published in the first week of every month. We scan the universe of roughly 7,500 stocks listed and traded on U.S. exchanges and use our proprietary filtering criteria to select five relatively safe stocks that may be trading cheaper compared to their historical valuations. Some sections in the article, like “Selection Process/Methodology,” are repeated each month with few changes. This is intentional as well as unavoi ...

Company and Industry Overview * **Company**: Archer-Daniels-Midland Company (ADM) [1] * **Industry**: Consumer Staples, Agriculture, Oilseeds, Nutrition [1] Key Points and Arguments * **Commodity Markets and Global Environment**: ADM acknowledges the challenging conditions in commodity markets, particularly for grains and processing, due to ample supplies from South America and a contraction in commodity prices [4]. * **Productivity and Innovation**: ADM has initiated a program of productivity and innovation to offset the decline in commodity prices, resulting in increased volumes and lower costs in 2024 [5]. * **Nutrition Division Improvement**: The Nutrition division has shown sequential improvement in Q1 and Q2, with potential for significant sequential improvements in the next two quarters [6]. * **Capital Allocation**: ADM maintains strong cash flows and a healthy balance sheet, allowing for flexibility in capital allocation. The company has repurchased shares, increased dividends, and identified opportunities for automation, decarbonization, and Nutrition growth [7]. * **Market Landscape and Outlook**: ADM expects a strong fourth quarter and a good second half of 2024, driven by improved crush margins, ethanol margins, and demand for soybean meal [18]. * **Cost Reductions**: ADM has achieved cost savings of $125 million in the first half of 2024, with a target of $500 million in cost savings over two years [24]. * **Ag Services and Oilseeds**: ADM sees opportunities in the global Ag Services and Oilseeds market, driven by increasing protein consumption and mandates for renewable fuels [31]. * **Carb Solutions**: Carb Solutions has outperformed expectations, with a focus on reducing exposure to vehicle ethanol and increasing demand for corn for fermentation, sustainable packaging, mining, paper, and other applications [38]. * **Nutrition**: The Nutrition division is recovering from a challenging 2023, with growth in Human Nutrition and Animal Nutrition, particularly in probiotics and biotics [42]. * **Decatur Plant**: The Decatur plant is expected to come online in late 2024, with a significant impact on 2025 earnings [50]. * **Capital Allocation Priorities**: ADM continues to prioritize share buybacks, dividends, and capital allocation for innovation and portfolio management [52]. Additional Important Content * **Monish Patolawala's Background**: Monish Patolawala joined ADM as EVP and CFO in August 2024, bringing experience in operating rigor and smart capital allocation from his previous role at 3M [9]. * **Insurance Proceeds**: ADM is working on obtaining insurance proceeds from the fires in Decatur, with an expected impact on the fourth quarter and beyond [20]. * **Renewable Diesel**: ADM expects short-term volatility in renewable diesel markets due to changes in the Renewable Diesel Tax Credit [36]. * **Sustainable Aviation Fuels (SAF)**: ADM is exploring opportunities to convert ethanol into SAF, leveraging its low carbon intensity ethanol and carbon capture and sequestration capabilities [40]. * **Portfolio Management**: ADM is reviewing its portfolio for potential divestitures or joint ventures to create more value for shareholders [53].

Core Insights - Archer-Daniels-Midland Company (ADM) is optimistic about its future, particularly over the next 5 to 10 years, despite current challenges in commodity markets and a decline in margins and profits for Ag Services & Oilseeds [4][6][8] - The company has implemented an aggressive productivity and innovation program to offset declines in commodity prices, resulting in increased volumes and lower costs [5][7] - ADM's Nutrition division has shown sequential improvement in performance, with expectations for continued growth in the second half of 2024 [6][8] Financial Performance - ADM reported strong cash flows despite profit declines, maintaining a healthy balance sheet that allows for flexibility in capital allocation [7][8] - The company has achieved $125 million in cost savings in the first half of 2024 as part of a $500 million cost-saving program over two years [24][25] - ADM anticipates a strong fourth quarter, driven by improved crush margins and increased demand for soybean meal and oil [19][20] Market Outlook - The global environment for grains and processing has changed significantly, with ample supplies from South America and lower commodity prices impacting margins [4][18] - Demand for soybean meal is increasing, with inclusion rates rising from 16-17% to about 18%, translating to an additional 0.5 million tons of demand [19] - The renewable diesel market is expected to grow, with 950 million gallons of capacity coming online in the second half of the year, further supporting ADM's crush operations [19][36] Strategic Initiatives - ADM is focusing on three key trends: food security, health and wellbeing, and sustainability, which are expected to provide growth opportunities [7][8] - The company is investing in automation and digitization of its manufacturing processes to enhance operational efficiency [26][27] - ADM is exploring opportunities in sustainable aviation fuels and low carbon intensity ethanol, aiming to reduce carbon emissions and improve profitability [38][40] Nutrition Segment - The Nutrition business is recovering from a challenging 2023, with Human Nutrition showing a 10% profit growth, particularly in the flavors segment [42][43] - The company is pivoting its strategy in specialty ingredients to focus on health-oriented products rather than traditional plant-based protein replacements [43][44] - Probiotics and biotics have exceeded expectations, with significant demand in both human and animal nutrition sectors [45][46] Capital Allocation - ADM has executed $2.3 billion in share buybacks and increased dividends, demonstrating a commitment to returning value to shareholders [52] - The company is evaluating its capital allocation strategy to ensure investments align with market opportunities and long-term growth [52][54] - ADM is open to portfolio management strategies, including potential divestitures or joint ventures to optimize its business segments [54]

Royal Bank of Canada, Cisco Systems, and Archer-Daniels-Midland offer attractive yields and strong growth potential in a changing interest rate environment.High-yield dividend stocks are catching the eye of savvy investors. With Federal Reserve Chairman Jerome Powell strongly hinting that interest rate cuts will begin shortly, these income-generating powerhouses could be on the verge of a significant rally. Historically, when benchmark interest rates fall and bond yields follow suit, many fund managers shif ...

Archer Daniels Midland Company (ADM) is actively managing productivity and innovation, as well as aligning work to the interconnected trends in food security, health and wellbeing. In the latest development, the company, in collaboration with Farmers Business Network (“FBN”), launched a joint venture, Gradable, to accelerate technology solutions. This will allow farmers and buyers to pursue and boost value from grain produced via sustainable and regenerative practices. Introduced in 2020, the Gradable techn ...

Both stocks have fallen hard and have historically high yields.It can be hard to find a good dividend stock when the broader market's yield is a miserly 1.3%. But you can do it if you are willing to look hard enough. One good place to start is with stocks that are underperforming, such as Archer-Daniels Midland (ADM 0.39%) and UPS (UPS 0.86%). Both have historically high yields today.Archer-Daniels Midland is getting back to normalArcher-Daniels Midland, usually just referred to by its ticker ADM, has a div ...

wellesenterprises Introduction On July 24, I wrote an article on "3 Fantastic Dividend Growth Stocks You Need To Know." In the intro of that article, I included a part of Hendrik Bessembinder's latest scientific article, which showed that the positive stock market return in the past was driven by the minority of stocks, as the majority had negative cumulative returns. This report describes compound return outcomes for the 29,078 publicly-listed common stocks contained in the CRSP database from December ...

smrm1977 Foreword As a supplement to this article, please note that The Motley Fool, which sourced this latest list, and SureDividend both update their lists periodically. While most of this August collection of 53 Kings are too pricey to justify their skinny dividends, six of the top ten, by yield, and one more outside those ten, live up to the ideal. That is, they offer annual dividends (from a $1K investment) exceeding their single share prices. This month there are nine more to watch. Note that two ...

Cohen/Ostrow/DigitalVision via Getty Images Foreword As a supplement to this article, please note that Kiplinger has published an on-line slide-show detailing the latest 2024 S&P Dividend Aristocrats. The article, entitled The S&P 500 Dividend Aristocrats, is by Dan Burrows, a contributing editor. S&P Dow Jones Indices rebalances the S&P 500 Dividend Aristocrats every January, the Aristocratic population now stands at 67. There were two changes to the Dividend Aristocrats announced in January 2024. Walgree ...

Archer Daniels Midland Company (ADM) posted second-quarter 2024 results, wherein the bottom and top lines missed the Zacks Consensus Estimate. Both metrics declined year over year.Adjusted earnings of $1.03 per share missed the Zacks Consensus Estimate of $1.23. Also, the figure declined 46% from earnings of $1.89 per share in the year-ago quarter. On a reported basis, Archer Daniels’ earnings were 98 cents per share, down 42.4% from the year-ago quarter’s $1.70.Revenues fell 9.5% year over year to $22.2 bi ...