Archer Daniels Midland is Above Target on Earnings

 @ibtimes on November 06 2007 9:51 AM

Archer Daniels Midland posted first-quarter earnings of 68 cents per share, 10% better than last year's same-quarter earnings. Not only were the results better than a year ago, but they also topped the consensus estimate by 9 cents per share. Sales for the quarter increased 35.4%, hitting $12.83 billion from $9.45 billion a year ago. According to Thomson Financial, analysts expected sales of $10.6 billion. The company noted that it has struggled with falling retail prices and lower biodiesel earnings as biofuel production begins to catch up with demand. The company's corn-processing profit dropped thanks to lower ethanol sale prices.

The stock gapped higher thanks to the strong results, but it has backed off from resistance at the 37.50 level. The shares retreated from this level in May and we could be rather close to see ADM forming a double top at the 37.50 level. Looking for sentiment that could push the stock higher? Well, ADM's Schaeffer's put/call open interest ratio of 0.87 is higher than 60% of those taken during the past 52 weeks. This percentile ranking suggests that we could see the mild pessimism unwind in the form of buying pressure. This is the only sentiment area where ADM could receive a boost, as both short sellers and analysts are rather bullishly aligned.

Join the Discussion