Archer-Daniels-Midland Company (ADM): Spotting Value From Recent Insider Activity

The surge in insider selling at Archer-Daniels-Midland Company (NYSE:ADM) is picking up steam with the current sell/buy ratio now at 12.17. ADM recorded 5 sales on the open market in the last three months. They sold nearly 25,567 shares while purchases amounted to 2,100 shares that period. Looking even further back to 12 months, corporate insiders offloaded 307,502 shares when buyers snapped up 450,015 shares. The 12-month’s totals signify about a 0.68-to-1 sell/buy ratio.

Young Ray G gathered a total of 2.1 thousand shares of Archer-Daniels-Midland Company (ADM) at average share price of $47.35. This insider trade in the company took place on 11/07/2018. The total for the purchase was set at $99.44 thousand. After this transaction, the CFO account balance stood at 310.19 thousand shares. The stock lost -3.84 percent since that insider purchase. On 10/08/2018, Stott John P, Group VP, Finance & Controller, sold 2.5 thousand shares at a price per share of $52. This removed 130 thousand shares from the insider’s fortune and the stock saw a -12.44 percent retreat in value since the news became public. This transaction left 33.43 thousand shares in the Group VP, Finance & Controller account.

On 08/27/2018, Senior Vice President Taets Joseph D. performed a sale transaction worth $109.8 thousand. This sale at $51 each has eliminated 2.15 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -10.73 percent decrease since the transaction was reported. The insider now is left with 170.1 thousand shares remaining in the account. Taets Joseph D., who performs the Senior Vice President job, sold 3.85 thousand shares for $196.24 thousand. The disposal occurred on 08/20/2018 was priced at $51.01 per share. The share price plunged -10.74 percent since the reporting date. Taets Joseph D. now left with a stake of 172.25 thousand ADM stock worth $7.84 million after the insider selling.

The 12-month median price target for Archer-Daniels-Midland Company (ADM) assigned by the analysts stands at $54, which represents a return potential of 18.6 percent when compared to the closing price of the stock of $45.53 on Thursday, December 06. The lowest price target for the stock is $48 — slightly more than 5.42 percent from ADM’s current share price. The stock will probably climb 17.81 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $58-month high price target. This represents a whopping 27.39 percent increase from where shares are trading today.

On momentum oscillators front, ‘RSI’ has touched 37.24 on daily chart, which may remain a cause for comfort. If the price breaks below $43.71 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $45.99 mark may result into a pull-back move towards $46.46 level. The stock is currently hovering around the first support level of $44.62. Below this, the next support is placed in the zone of $43.71. Till the time, the ADM stock trades above this level, bulls have nothing to fear.

Shares of Archer-Daniels-Midland Company (ADM) are trading at a P/E ratio of 12.74 times earnings reported for the past 12 months. The industry ADM operates in has an average P/E of 20.85. Its P/E ratio went as low as 12.31X and as high as 21.44 over the 5-year span. Further, it is sporting a 0.4 on the Price-to-Sales ratio. Compare this with the industry average P/S of 1.78. 6.3 percent is the gross profit margin for Archer-Daniels-Midland Company and operating margin sits at 3 percent. Along with this, the net profit margin is 3.5 percent.

On 6th of December, Archer-Daniels-Midland Company (NYSE:ADM) shares ended lower after a volatile session. The shares dropped -0.08 points or -0.18 percent at $45.53 with a heavy trade volume of 5.064 million shares. After opening the session at $45.38, the shares went as high as $45.545 and as low as $44.17, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $25.5 billion and now has 560.89 million shares outstanding. Archer-Daniels-Midland Company (ADM) stock has lost -5.34 percent of market value in 21 trading days.

In last reported earnings results, ADM earned $0.92 per share, better than the $0.83, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $15.8B, better than the $15.4B analysts expected. Earnings are estimated to increase by 10.3 percent this year, 2.41 percent next year and continue to increase by -8.8 percent annually for the next 5 years. Investors will get their next glimpse of ADM’s Q4 earnings on February 05. Analysts are forecasting revenue to climb 4.6 percent to $16.8B in the next fiscal quarter, while earnings are seen soaring by nearly 15.85 percent to $0.95 per share. History has shown that shares in Archer-Daniels-Midland Company have gone up on 18 different earnings reaction days and are predicted to add 0.03 percent when the company reports upcoming earnings.

ADM stock has a trailing 3-year beta of 0.98, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $3.62 a share in the trailing twelve months. The stock’s value has surged 13.6 percent year to date (YTD) against a rise of 11.48 percent in 12 month’s time. The company’s shares still trade -12.55 percent away from its 1-year high of $52.06 and 15.91 percent up from 52-week low of $39.28. The average consensus rating on the company is 2.2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.