Archer-Daniels-Midland Company Fundamental Analysis (NYSE: ADM)
Archer-Daniels-Midland Company Fundamental Analysis (NYSE: ADM)
Archer-Daniels-Midland Company (NYSE: ADM) shows weak financial fundamentals with a PE ratio of 22.08, profit margin of 2.16%, and ROE of 7.73%. The company generates $81.6B in annual revenue with weak year-over-year growth of -6.15%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 31.4/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ADM's fundamental strength across five key dimensions:
Efficiency Score
WeakADM struggles to generate sufficient returns from assets.
Valuation Score
ExcellentADM trades at attractive valuation levels.
Growth Score
WeakADM faces weak or negative growth trends.
Financial Health Score
ExcellentADM maintains a strong and stable balance sheet.
Profitability Score
WeakADM struggles to sustain strong margins.
Key Financial Metrics
Is ADM Expensive or Cheap?
P/E Ratio
ADM trades at 22.08 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, ADM's PEG of 0.37 indicates potential undervaluation.
Price to Book
The market values Archer-Daniels-Midland Company at 1.66 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 8.87 times EBITDA. This is generally considered low.
How Well Does ADM Make Money?
Net Profit Margin
For every $100 in sales, Archer-Daniels-Midland Company keeps $2.16 as profit after all expenses.
Operating Margin
Core operations generate 2.46 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $7.73 in profit for every $100 of shareholder equity.
ROA
Archer-Daniels-Midland Company generates $3.31 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Archer-Daniels-Midland Company generates limited operating cash flow of $2.78B, signaling weaker underlying cash strength.
Free Cash Flow
Archer-Daniels-Midland Company generates weak or negative free cash flow of $1.67B, restricting financial flexibility.
FCF Per Share
Each share generates $3.46 in free cash annually.
FCF Yield
ADM converts 4.34% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
22.08
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.37
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.66
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.47
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.40
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.39
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.08
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.06
vs 25 benchmark
How ADM Stacks Against Its Sector Peers
| Metric | ADM Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 22.08 | 20.62 | Neutral |
| ROE | 7.73% | 702.00% | Weak |
| Net Margin | 2.16% | -2241.00% (disorted) | Weak |
| Debt/Equity | 0.40 | 0.79 | Strong (Low Leverage) |
| Current Ratio | 1.39 | 2.31 | Neutral |
| ROA | 3.31% | 322.00% | Weak |
ADM outperforms its industry in 1 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Archer-Daniels-Midland Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
44.57%
Industry Style: Defensive, Dividend, Low Volatility
High GrowthEPS CAGR
-29.49%
Industry Style: Defensive, Dividend, Low Volatility
DecliningFCF CAGR
364.85%
Industry Style: Defensive, Dividend, Low Volatility
High Growth