Fundamentals
- Agriculture commodities and products processor ADM reported a 98% plunge in YoY profit for the 3rd quarter. Hurt by charges related to the company’s equity investments and lower demand for agricultural commodities and crop-based fuels like ethanol.
- For the 3rd quarter, the company posted profits of $8 million (0.01c a share) down from $517 million (0.80c / share) in the same quarter last year.
- The results were also attributed by the non-cash after tax charge of $132 million related to currency derivative losses of the company’s equity investment in Gruma S.A.B.
- An income tax charge of $97 million related to the company’s investment in Wilmar International
- Totaling those write-offs to $229 million.
- So overall without those charge-offs, the company would have earned $237 million.
- None the less consensus was 0.49c per share
- Sales dropped by 21% to $14.84 billion from $18.71 billion. Consensus was $16.94 billion
- Decline was due to decreased average selling prices that resulted from price relief of underlying commodity costs as well as foreign exchange impacts on top of decreased sales volume.
Technicals
Support has been formed around the $23.98 level. A good buying opportunity but no trend has been defined as of now. But would place a stop loss at $23.26 for cushion.
The results of ADM is now putting some concerns for my AGU holdings. But I believe that AGU is a better run company anyway, so will not add any more positions until earnings results which is on May 6th, tomorrow morning.
Source: RTT News
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