ADM Stock Builds A Base On Earnings Strength, Resumption Of Ukraine Trade

ADM’s double bottom base has a 91.91 entry, according to MarketSmith analysis. See if the stock can break out in volume at least 40% higher than normal. Keep in mind that it’s a third-stage base, which makes it riskier than earlier bases.

The stock has been trading above its 50-day and 200-day moving averages, and remained there on Thursday.

On Tuesday, ADM got an upgrade for its IBD SmartSelect Composite Rating from 94 to 97.

The revised score means the stock currently tops 97% of all other stocks in terms of key performance metrics and technical strength. The top-performing stocks tend to have a 90 or better Composite grade as they begin to launch a significant move. So be sure to keep that in mind when looking for the best stocks to buy and watch.

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The stock earns a 96 EPS Rating. Its Accumulation/Distribution Rating of B- shows moderate buying by institutional investors over the last 13 weeks.

The company on July 26 reported a 62% rise in earnings for Q2. That marks three straight reports with rising EPS growth. Sales growth came in at 19%, down from 25% in the previous quarter.

For 2022, analysts surveyed by FactSet call for ADM to report earnings of $6.75 a share on sales of $96.79 billion.

Commodities traders like ADM, Bunge (BG) and privately held Cargill help direct the flow of corn, soybeans, wheat and other commodities around the world. That has been difficult to do ever since Russia invaded Ukraine, which is known as the breadbasket of Europe. So when Ukraine resumed shipments of wheat this past week, that was taken as a positive sign for the industry.

“We need to have two very good years of good crops in North America and South America to bring a little bit more relief to the current supply-demand inventories,” ADM Chief Executive Juan Luciano told analysts Tuesday.

Chicago-based ADM earns the No. 1 rank among its peers in the Food-Grain & Related industry group. Ingredion (INGR) and Andersons (ANDE) are also among the group’s highest-rated stocks. The industry group itself is ranked No. 72 of out of 197 industry groups.