Shares of Monsanto Company (MON) hit a new 52-week high of $107.73 on May 3 and eventually closed at $107.28. The shares of this agricultural chemicals company have been gaining momentum since it reported solid fiscal second quarter results on Apr 3.
Year-to-date, share price has recorded a healthy return of 14.2%. The company’s long-term estimated EPS growth rate is 12.7%. Average volume of shares traded over the last three months came in at approximately 2,382K.
Solid Second Quarter Performance
Monsanto posted strong fiscal second quarter results led by an increase in revenue as well as earnings. Earnings per share came in at $2.73, beating the Zacks Consensus Estimate of $2.53 per share. Earnings also grew 19.7% year over year, driven by solid top line growth.
Revenue was reported to be $5.5 billion, up 15.2% year over year, beating the Zacks Consensus Estimate of $5.3 billion. The main reason for increased revenue was the improvement in the company’s global corn business.
The corn business is expected to flourish in the coming quarters as well, especially in Brazil and Argentina. Moreover, management is quite optimistic about the U.S. seed business on the back of its second quarter performance and expects fiscal 2013 to be one of the highest revenue earning years for the company.
Also, Monsanto’s R&D lineup in molecular-bred hybrid technologies as well as technical collaboration with agri-business research firms continue to support sustainability and modernization in cropping pattern for long-term growth.
The estimates have been mostly revised upwards for fiscal 2013 and 2014, subsequent to the earnings release. Over the last thirty days, the Zacks Consensus Estimate has risen 0.65% to $4.58 for fiscal 2013, while rising 1.73% to $5.28 for fiscal 2014.
Other Stocks to Consider
Monsanto currently carries a Zacks Rank #2 (Buy). Other stocks worth a look in the industry are Celanese Corporation (CE), FMC Corp. (FMC) and Methanex Corporation (MEOH); each carrying a Zacks Rank #2 (Buy).
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