ADM
ADM
Hold 2026-04-24
Model
DCF
Price at Report
$70.03
Base IV
$73.35
Bear IV
$26.54
Bull IV
$150.37
Entry Zone: 25-67 · Sell Above: 128
Bore Family Office
Valuation Report — Archer-Daniels-Midland Co (ADM) • April 24, 2026
Unlevered DCF (FCFF @ WACC) • Discount Rate: 9.00% • Current Price: $70.03
Prepared by Lurch • Bore Family Office • Data: Finnhub, StockAnalysis.com, S&P Global Market Intelligence
🏢 Business Overview
Archer-Daniels-Midland is one of the world's largest agricultural processors and commodity trading companies, operating across oilseed processing (soybean, canola), carbohydrate solutions (corn wet milling, wheat), nutrition (specialty ingredients, flavors), and agricultural services (grain merchandising, transportation). Founded in 1902, ADM processes >50% of US soybeans and is a critical link in the global food supply chain. The company has raised its dividend for 17 consecutive years, though growth has slowed to ~2% recently. ADM faces cyclical margin compression and an ongoing accounting investigation (2024) that has impaired investor confidence.
| Business Segment | Revenue | % of Total | YoY Growth | Margin | Notes |
|---|---|---|---|---|---|
| Ag Services & Oilseeds | $42,500M | 53% | -8.0% | — | Grain trading, soybean/canola crushing, tropical oils |
| Carbohydrate Solutions | $18,500M | 23% | -4.0% | — | Corn wet milling, starches, sweeteners, ethanol |
| Nutrition | $8,500M | 11% | -6.0% | — | Specialty ingredients, flavors, proteins, supplements |
| Other / Corporate | $10,769M | 13% | -3.0% | — | Risk management, freight, corporate |
| Blended Growth Rate | — | 100% | -6.2% | — | Weighted avg across segments |
📊 Business Lifecycle Stage
Stage 1
Startup
Startup
Stage 2
Hyper Growth
Hyper Growth
Stage 3
Self Funding
Self Funding
Stage 4
Operating Leverage
Operating Leverage
Stage 5
Capital Return
Capital Return
Stage 6
Decline
Decline
Stage 5 — Capital Return: Mature business returning capital via dividends and buybacks. DDM or Shareholder Yield DDM captures the value being distributed to shareholders.
Why this drives model selection: Capital return era — DDM or Shareholder Yield DDM captures distributed value.
🔍 Quality Scorecard
| Metric | Value | Assessment |
|---|---|---|
| ROIC | 4.0% | <8% weak |
| FCF Margin | 5.2% | 5–10% adequate |
| Debt / EBITDA | 3.8x | 2–4x moderate |
| Revenue Trend | Declining 3yr | 3-year directional trend |
| FCF Margin Trend | Stable (±1pp) | Directional margin trajectory |
| Analyst Revisions | Downward revisions | Last 90 days consensus direction |
⚠️ Elevated value trap risk — verify thesis before acting
📊 Financial Snapshot
| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue ($M) | $85,249 | $101,556 | $93,935 | $85,530 | $80,269 |
| Rev YoY Growth | — | +19.1% | -7.5% | -8.9% | -6.2% |
| Gross Margin | 7.0% | 7.5% | 8.0% | 6.8% | 6.3% |
| EBITDA ($M) | $3,731 | $4,816 | $4,598 | $2,417 | $1,982 |
| EBITDA Margin | 4.4% | 4.7% | 4.9% | 2.8% | 2.5% |
| Operating Income ($M) | $2,735 | $3,788 | $3,539 | $1,276 | $801 |
| Operating Margin | 3.2% | 3.7% | 3.8% | 1.5% | 1.0% |
| Net Income ($M) | $2,709 | $4,340 | $3,483 | $1,800 | $1,078 |
| Net Margin | 3.2% | 4.3% | 3.7% | 2.1% | 1.3% |
| EPS (diluted) | $4.79 | $7.71 | $6.43 | $3.65 | $2.23 |
| Free Cash Flow ($M) | $5,426 | $2,159 | $2,966 | $1,227 | $4,204 |
| Annual DPS | $1.480 | $1.600 | $1.800 | $2.000 | $2.040 |
| Total Debt ($M) | $8,581 | $8,677 | $8,260 | $8,254 | $7,612 |
💹 Capital Return & Share Count Analysis
Net Share Change
-14.1% (2021→2025)
📉 Net reduction — buybacks exceed issuances
EPS Amplification
EPS grew -53.4% vs net income -60.2% over the period — +6.8pp of EPS growth amplified by share reduction.
| Year | Diluted Shares (M) | YoY Change | Buyback Spend ($M) | Buyback Yield |
|---|---|---|---|---|
| 2021 | 560.0M | — | $200 | 0.5% |
| 2022 | 563.0M | +0.5% | $800 | 2.0% |
| 2023 | 542.0M | -3.7% | $1,200 | 3.2% |
| 2024 | 493.0M | -9.0% | $1,800 | 5.2% |
| 2025 | 481.0M | -2.4% | $500 | 1.5% |
ADM accelerated buybacks in 2023-2024, retiring ~14% of shares. 2025 buybacks slowed to ~$500M as cash was prioritized for debt reduction and the dividend. Share count decline is meaningful and consistent.
⚙️ WACC Build (DCF)
| Input | Value | Notes |
|---|---|---|
| Risk-Free Rate (Rf) | 4.25% | 10-yr US Treasury yield |
| Beta (β) | 0.560 | Market beta (Finnhub) |
| Equity Risk Premium (ERP) | 5.5% | Damodaran US ERP |
| Cost of Equity (Ke) | 7.33% | Ke = Rf + β × ERP |
| Pre-Tax Cost of Debt | 4.50% | Interest exp / gross debt |
| After-Tax Cost of Debt (Kd) | 3.56% | × (1 − 21%) |
| Weight Equity (We) | 81.6% | Mkt cap $0.0B |
| Weight Debt (Wd) | 18.4% | Gross debt $0.0B |
| WACC | 9.00% | DCF discount rate |
📈 DCF Scenarios
$27
🔴 Bear
$73
📊 Base
$150
🚀 Bull
$70.03
Current Price
$64
Analyst Avg PT
| Scenario | Stage 1 (Yrs 1–5) | Stage 2 (Yrs 6–10) | Terminal g | WACC | Intrinsic Value | vs Price |
|---|---|---|---|---|---|---|
| 🔴 Bear | -5.0% | 0.0% | 2.0% | 10.50% | $27 | ▼62.1% |
| 📊 Base | 3.0% | 2.0% | 2.5% | 9.00% | $73 | ▲4.7% |
| 🚀 Bull | 8.0% | 4.0% | 3.0% | 8.00% | $150 | ▲114.7% |
📋 Full 10-Year Projection Tables
Bear Scenario
Stage 1: -5.0% | Stage 2: 0.0% | Terminal: 2.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $1.80B | $1.63B | $1.63B |
| Year 2 ✦ | Stage 1 | $1.70B | $1.39B | $3.02B |
| Year 3 ✦ | Stage 1 | $1.60B | $1.19B | $4.21B |
| Year 4 ✦ | Stage 1 | $1.50B | $1.01B | $5.21B |
| Year 5 ✦ | Stage 1 | $1.50B | $0.91B | $6.12B |
| Year 6 | Stage 2 | $1.50B | $0.82B | $6.95B |
| Year 7 | Stage 2 | $1.50B | $0.75B | $7.69B |
| Year 8 | Stage 2 | $1.50B | $0.67B | $8.37B |
| Year 9 | Stage 2 | $1.50B | $0.61B | $8.98B |
| Year 10 | Stage 2 | $1.50B | $0.55B | $9.53B |
| Terminal | — | TV=$18.0B | PV(TV)=$6.6B (41% of EV) | EV=$16.2B |
| Intrinsic Value | — | — | EV $16.2B − Net Debt → Equity / Shares | $27 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (10.50%) to get its present value. After Year 10, FCF grows at the terminal rate (2.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $18.0B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $6.6B). Enterprise Value = PV of FCFs ($9.5B) + PV of TV ($6.6B) = $16.2B. Subtracting net debt gives equity value of $12.8B, divided by shares outstanding = $27 per share.
Base Scenario
Stage 1: 3.0% | Stage 2: 2.0% | Terminal: 2.5%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $2.50B | $2.29B | $2.29B |
| Year 2 ✦ | Stage 1 | $2.58B | $2.17B | $4.47B |
| Year 3 ✦ | Stage 1 | $2.66B | $2.05B | $6.52B |
| Year 4 ✦ | Stage 1 | $2.74B | $1.94B | $8.46B |
| Year 5 ✦ | Stage 1 | $2.83B | $1.84B | $10.30B |
| Year 6 | Stage 2 | $2.89B | $1.72B | $12.02B |
| Year 7 | Stage 2 | $2.94B | $1.61B | $13.63B |
| Year 8 | Stage 2 | $3.00B | $1.51B | $15.14B |
| Year 9 | Stage 2 | $3.06B | $1.41B | $16.55B |
| Year 10 | Stage 2 | $3.12B | $1.32B | $17.87B |
| Terminal | — | TV=$49.3B | PV(TV)=$20.8B (54% of EV) | EV=$38.7B |
| Intrinsic Value | — | — | EV $38.7B − Net Debt → Equity / Shares | $73 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (9.00%) to get its present value. After Year 10, FCF grows at the terminal rate (2.5%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $49.3B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $20.8B). Enterprise Value = PV of FCFs ($17.9B) + PV of TV ($20.8B) = $38.7B. Subtracting net debt gives equity value of $35.3B, divided by shares outstanding = $73 per share.
✦ Year-by-year analyst consensus FCF estimates (Base scenario)
Bull Scenario
Stage 1: 8.0% | Stage 2: 4.0% | Terminal: 3.0%
| Period | Stage | FCFF | PV of FCFF | Cumulative EV |
|---|---|---|---|---|
| Year 1 ✦ | Stage 1 | $3.00B | $2.78B | $2.78B |
| Year 2 ✦ | Stage 1 | $3.30B | $2.83B | $5.61B |
| Year 3 ✦ | Stage 1 | $3.60B | $2.86B | $8.46B |
| Year 4 ✦ | Stage 1 | $3.90B | $2.87B | $11.33B |
| Year 5 ✦ | Stage 1 | $4.20B | $2.86B | $14.19B |
| Year 6 | Stage 2 | $4.37B | $2.75B | $16.94B |
| Year 7 | Stage 2 | $4.54B | $2.65B | $19.59B |
| Year 8 | Stage 2 | $4.72B | $2.55B | $22.15B |
| Year 9 | Stage 2 | $4.91B | $2.46B | $24.60B |
| Year 10 | Stage 2 | $5.11B | $2.37B | $26.97B |
| Terminal | — | TV=$105.3B | PV(TV)=$48.8B (64% of EV) | EV=$75.7B |
| Intrinsic Value | — | — | EV $75.7B − Net Debt → Equity / Shares | $150 |
How the price per share is derived: Each year's projected free cash flow is discounted back at WACC (8.00%) to get its present value. After Year 10, FCF grows at the terminal rate (3.0%) in perpetuity — the Gordon Growth formula gives a terminal value of FCF11 / (WACC − gT) = $105.3B. That terminal value is discounted back 10 years to today's dollars (PV of TV = $48.8B). Enterprise Value = PV of FCFs ($27.0B) + PV of TV ($48.8B) = $75.7B. Subtracting net debt gives equity value of $72.3B, divided by shares outstanding = $150 per share.
🔲 Sensitivity Table
| WACC \ gT | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 7.0% | $97 | $104 | $112 | $122 | $135 |
| 7.5% | $88 | $94 | $100 | $108 | $117 |
| 8.0% | $81 | $85 | $90 | $96 | $104 |
| 8.5% | $75 | $78 | $82 | $87 | $93 |
| 9.0% | $69 | $72 | $75 | $79 | $84 |
| 9.5% | $64 | $67 | $69 | $73 | $76 |
| 10.0% | $60 | $62 | $64 | $67 | $70 |
| 10.5% | $56 | $58 | $60 | $62 | $65 |
| 11.0% | $53 | $54 | $56 | $58 | $60 |
Green = >10% above current price. Red = >10% below. Gold = within ±10%.
📉 Long-Term Price Trend Channel
Log-linear trend fitted to full price history. ±1.5σ bands. Green shaded zone = bottom 25% of historical range — historically attractive entry.
🏦 Comparable Valuation
| Company | Ticker | P/E | EV/EBITDA | P/FCF | Div Yield | Notes |
|---|---|---|---|---|---|---|
| Bunge | BG | 11.5x | 7.8x | 14.0x | 2.8% | Oilseed peer; being acquired by Glencore |
| Cargill | Private | — | — | — | ~2.5% | Private peer; similar commodity exposure |
| Ingredion | INGR | 14.2x | 10.5x | 16.0x | 2.6% | Corn processing; higher margin |
| Tyson Foods | TSN | 15.0x | 9.2x | 18.0x | 3.2% | Protein processor; cyclical |
| ADM 5yr Avg | ADM | 14.5x | 9.0x | 15.0x | 2.6% | Own history: trading at discount to avg |
💰 Dividend / Distribution Analysis
| Metric | Value |
|---|---|
| Annual DPS | $2.040 |
| Current Yield | 2.91% |
| Consecutive Growth Years | 17 |
| 1-yr DPS CAGR | +2.0% |
| 3-yr DPS CAGR | +4.2% |
| 5-yr DPS CAGR | +5.0% |
| 10-yr DPS CAGR | +6.0% |
| Payout Ratio (DPS/EPS) | 91.5% ⚠️ |
| FCF Payout Ratio | 23.3% |
| Sustainability Verdict | Watch |
17-year growth streak, but payout ratio of 91% on GAAP EPS is elevated. FCF payout of 23% is very healthy — the dividend is well-covered by cash flow. Recent 2% growth rate (vs 5-10% historically) signals management is prioritizing caution during the downturn. Dividend is safe but growth may remain muted until margins recover.
🔮 Analyst Forecast Section
(a) EPS Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $4.79 | — | — | — | Actual |
| 2022 | $7.71 | — | — | — | Actual |
| 2023 | $6.43 | — | — | — | Actual |
| 2024 | $3.65 | — | — | — | Actual |
| 2025 | $2.23 | — | — | — | Actual |
| 2026 | $3.68 | $4.24 | $5.33 | 15 | Estimate |
| 2027 | $4.02 | $4.91 | $6.20 | 14 | Estimate |
(b) Revenue Consensus
| Year | Low / Actual | Avg | High | # Analysts | Type |
|---|---|---|---|---|---|
| 2021 | $85.2B | — | — | — | Actual |
| 2022 | $101.6B | — | — | — | Actual |
| 2023 | $93.9B | — | — | — | Actual |
| 2024 | $85.5B | — | — | — | Actual |
| 2025 | $80.3B | — | — | — | Actual |
| 2026 | $79.0B | $84.1B | $90.8B | 15 | Estimate |
| 2027 | $79.9B | $86.5B | $94.7B | 14 | Estimate |
(c) Individual Analyst Price Targets
| Analyst | Firm | Rating | PT | Upside |
|---|---|---|---|---|
| Dushyant Ailani | Jefferies | Hold | $77 | +10.0% |
| Benjamin Theurer | Barclays | Hold | $77 | +10.0% |
| Thomas Palmer | JP Morgan | Sell | $65 | -7.2% |
💡 Investment Thesis
- Deep value on trough earnings: At 16.5× forward EPS and 2.9% yield, ADM prices in continued margin deterioration. Any stabilization in crush margins drives a sharp re-rating.
- Essential infrastructure: ADM's processing assets are irreplaceable infrastructure — 50%+ US soybean crush capacity and a global logistics network create a wide moat.
- 17-year dividend growth streak: Even through the current downturn, ADM has maintained and grown the dividend. FCF of $4.2B covers the $980M dividend with ample room.
- Key risk — accounting investigation: The 2024 accounting probe into Nutrition segment intersegment transfers has eroded investor trust. CFO resigned. Multiple class-action lawsuits pending.
👔 Management Quality & Culture
CEO: Juan Luciano · Tenure: Since 2011 (~15 yrs)
Net Insider Buys (12m)
-370,825 shares
Incentive Alignment
⚠️ Moderate
Compensation: Equity-based compensation present
CEO Background & Track Record
Archer Daniels Midland - Wikipedia
Dwayne Andreas was named CEO of ADM in 1970, and two years later was elected chairman of the company's board. Under his leadership, Archer Daniels Midland acquired many smaller agricultural companies and expanded into
Dwayne Andreas was named CEO of ADM in 1970, and two years later was elected chairman of the company's board. Under his leadership, Archer Daniels Midland acquired many smaller agricultural companies and expanded into
Archer Daniels Midland CEO and Key Executive Team | Craft.co
Archer Daniels Midland's Chairman of the Board of Directors, President, Chief Executive Officer is Juan R. Luciano. Archer Daniels Midland's key executives include Juan R.
Archer Daniels Midland's Chairman of the Board of Directors, President, Chief Executive Officer is Juan R. Luciano. Archer Daniels Midland's key executives include Juan R.
Juan R. Luciano - Illinois Economic Development Corporation
Mr. Luciano joined ADM in 2011 as Executive Vice President and Chief Operating Officer. He was named President in February 2014, and in January 2015 became the ninth Chief Executive in ADM’s 112-year history.
Mr. Luciano joined ADM in 2011 as Executive Vice President and Chief Operating Officer. He was named President in February 2014, and in January 2015 became the ninth Chief Executive in ADM’s 112-year history.
Capital Allocation & Strategy
Archer-Daniels-Midland (ADM) Q4 2024 Earnings Call Transcrip
In 2024, the company returned $3.3 billion in the form of dividends and share repurchases, allocated $1.6 billion to capital expenditures to support the reliability of our assets and cost efficiencies, and approximately $1
In 2024, the company returned $3.3 billion in the form of dividends and share repurchases, allocated $1.6 billion to capital expenditures to support the reliability of our assets and cost efficiencies, and approximately $1
Archer Daniels Midland Co (ADM) 10K Annual Reports & 10Q SEC
Cash flows from operations before working capital is cash flows from operating activities of $2,780 million excluding the changes in working capital of $(519) million in YTD 2024.
Cash flows from operations before working capital is cash flows from operating activities of $2,780 million excluding the changes in working capital of $(519) million in YTD 2024.
Employee Ratings
Overall Rating
3.4/5 ★★★☆☆
Reviews
1,212
Culture Signal
Positive
✅ Strengths
- work-life balance
- recommend
Employee Review Excerpts
Archer Daniels Midland (ADM) Reviews | Glassdoor
79% of Archer Daniels Midland (ADM) employees would recommend working there to a friend based on Glassdoor reviews. Employees also rated Archer Daniels Midland (ADM) 3.4 out of 5 for work life balance, 3.7 for culture and values
79% of Archer Daniels Midland (ADM) employees would recommend working there to a friend based on Glassdoor reviews. Employees also rated Archer Daniels Midland (ADM) 3.4 out of 5 for work life balance, 3.7 for culture and values
Archer Daniels Midland (ADM) - Status Matters | Glassdoor
Archer Daniels Midland (ADM) See All Reviews (1301)See All (1301) April 4, 2017 · StarStarStarStarStar · Work/Life Balance · Culture & Values · Career Opportunities · Compensation and Benefits · Senior Management · Former Employee - Tax
Archer Daniels Midland (ADM) See All Reviews (1301)See All (1301) April 4, 2017 · StarStarStarStarStar · Work/Life Balance · Culture & Values · Career Opportunities · Compensation and Benefits · Senior Management · Former Employee - Tax
Archer Daniels Midland Reviews & Ratings by 45 Employees | C
According to reviews on CareerBliss, employees commonly rated the pros of working at Archer Daniels Midland to be Company Culture, Growth Opportunities, People You Work With and Person You Work For, and no cons.
According to reviews on CareerBliss, employees commonly rated the pros of working at Archer Daniels Midland to be Company Culture, Growth Opportunities, People You Work With and Person You Work For, and no cons.
Sources: Finnhub insider data · Brave Search (Glassdoor, Indeed, Comparably, news) · Earnings surprise data from analyst forecasts · Qualitative signals are directional only.
⚖️ DCF Verdict: Hold — Archer-Daniels-Midland Co (ADM)
Current price: $70.03 | Analyst Avg PT: $64.00
$27
🔴 Bear
$73
📊 Base
$150
🚀 Bull
| Tier | Price | Action |
|---|---|---|
| Tier 1 — Starter | ≤$67 | Begin position |
| Tier 2 — Add | ≤$50 | Add on weakness |
| Tier 3 — Full | ≤$25 | Full allocation |
| Sell Alert | ≥$128 | Above fair value — consider trimming |
How tiers are set: Tier 1 = Base IV × 0.92 (8% discount to base case). Tier 2 = midpoint of Bear & Base IV (building on meaningful weakness). Tier 3 = Bear IV × 1.05 (just above worst-case — maximum margin of safety). Sell alert = Bull IV × 0.85 (15% discount to bull case — above fair value range).
Verdict: Hold. ADM is a deep-value cyclical at trough margins, but the accounting investigation overhang and margin uncertainty warrant patience. The 2.9% yield is well-covered. Add below $60 on further weakness; full position below $50. Becomes a trim above $80.
🔧 Model Notes & Calibration
| Assumption | Rationale / Notes |
|---|---|
| Model Selection | DCF — ADM has a 17-year dividend streak but DPS growth has slowed to 2% and the company is cyclical with thin margins. DCF on FCF better captures the cyclical cash flow profile than DDM on a slowly growing DPS. |
| FCF Base | Normalized to $2.5B mid-cycle FCF. FY2025 reported FCF of $4.2B is inflated by ~$1.7B working capital release and reduced capex. Mid-cycle FCF of $2-3B is the sustainable base (consistent with EBITDA of $2B and 6% thin-margin economics). |
| Accounting Overhang | The 2024 Nutrition segment accounting investigation (intersegment transfer pricing) led to CFO resignation and restated financials. This is a real governance risk that justifies a discount. Models cannot fully capture this — noted as qualitative risk. |
| Lifecycle | Classifier failed — analyst judgment: Stage 5 (Mature Cash Cow). ADM is a mature processor with cyclical margins, moderate growth, and a reliable but slow-growing dividend. The business generates real cash but is not a growth story. |
Bore Family Office • Analysis generated by Lurch • Not investment advice.