Analyst cuts outlook for Archer-Daniels-Midland

Christina McGlone, writing in a client note, said uncertainty over the exact extent of damage to the U.S. corn crop from midwestern flooding creates price volatility.

Meanwhile, global demand for corn as feed is easing because of increasing wheat supplies. That could challenge sales of ADM's corn-based feed.

Further, slack demand may reduce the profitability of ADM's sweeteners and starches business.

She also said ethanol prices may decline, marking another challenge for ADM, which produces the motor fuel.

While reiterating a "Hold" rating on the stock, the analyst cut her earnings-per-share estimate for the fourth quarter of fiscal 2008, which ends this month, to 46 cents per share from the previous estimate of 75 cents per share.

Analysts polled by Thomson Financial expect, on average, earnings per share of 72 cents.

For fiscal 2009 she expects earnings per share of $2.54, down from the previous estimate of $3.14. Analysts polled by Thomson Financial expect $3.04.

She also cut her price target to $36 from $43.

Shares rose 44 cents to $33.60 in afternoon trading.