Archer-Daniels-Midland Co. (ADM) is one of the world’s largest agricultural origination and processing companies. With a global asset base connecting markets in more than 190 countries, the company connects harvest to the home and is a leading producer of human and animal nutrition products.
The company operates three business segments, including Ag Services & Oilseed, Carbohydrate Solutions, and Nutrition, which represented 80%, 12%, and 8%, respectively, of operating revenue during the fourth quarter of 2020.
The company’s revenue is spread out across the globe with consolidated subsidiaries in more than 80 countries.
Strong Momentum into 2021
Archer-Daniels-Midland reported fourth quarter revenue that rose 10.1% to $17.98 billion, which beat consensus estimates by $1.5 billion, along with GAAP earnings of $1.22 per share, exceeding estimates by seven cents per share. Based on drivers under its control, management expects another year of record earnings in 2021.
China purchased about 200 million gallons of ethanol from the United States for the first half of 2021, according to ADM CFO Ray Young, which would surpass the country’s previous annual import record in 2016. However, between 10% and 15% of U.S. ethanol production capacity remains idled due to poor margins as the market remains cautious.
The company raised its quarterly dividend by 2.8% to $0.37 per share, which represents a nearly 3% forward yield. The dividend is payable on March 2, 2021 to shareholders on record as of February 9, 2021.
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