Archer-Daniels-Midland Company Just Missed Earnings - But Analysts Have Updated Their Models

Archer-Daniels-Midland Company (NYSE:ADM) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Results showed a clear earnings miss, with US$22b revenue coming in 3.9% lower than what the analystsexpected. Statutory earnings per share (EPS) of US$0.98 missed the mark badly, arriving some 24% below what was expected. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

See our latest analysis for Archer-Daniels-Midland

Following the recent earnings report, the consensus from nine analysts covering Archer-Daniels-Midland is for revenues of US$87.0b in 2024. This implies a discernible 2.0% decline in revenue compared to the last 12 months. Statutory per-share earnings are expected to be US$5.35, roughly flat on the last 12 months. In the lead-up to this report, the analysts had been modelling revenues of US$89.7b and earnings per share (EPS) of US$5.44 in 2024. So it looks like the analysts have become a bit less optimistic after the latest results announcement, with revenues expected to fall even as the company is supposed to maintain EPS.

The consensus has reconfirmed its price target of US$62.13, showing that the analysts don't expect weaker revenue expectations next year to have a material impact on Archer-Daniels-Midland's market value. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Archer-Daniels-Midland, with the most bullish analyst valuing it at US$67.00 and the most bearish at US$57.00 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 4.1% by the end of 2024. This indicates a significant reduction from annual growth of 11% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 3.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Archer-Daniels-Midland is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have estimates - from multiple Archer-Daniels-Midland analysts - going out to 2026, and you can see them free on our platform here.

You still need to take note of risks, for example - Archer-Daniels-Midland has 2 warning signs (and 1 which is significant) we think you should know about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com