Value
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.3 |
| P/S | 10.0 |
| EV/EBITDA | 2.9 |
| Fwd P/E | 8.6 |
| PEG | 7.5 |
| Analyst target | 4.0 |
- ▸Forward P/E: 13.3x
- ▸PEG: 0.92
ADM · Why this verdict
Why Archer-Daniels-Midland (ADM) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score5.2/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
ADM is a low-quality farm-products business whose price ($76.91) already sits 9.2% above the $69.86 analyst target, leaving little reward for the risk. Weak margins and no moat offset a reasonable forward valuation.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Momentum score is 3.9/10 with falling on-balance volume signalling distribution, despite the price holding above its 200-day moving average. Momentum breakdown | Momentum score should recover above 4.5 with volume accumulation if the trend is healthy. | ↓Deteriorating |
| CounterRSI near 36 in an uptrend pullback is described as a buy opportunity, so the weakness could be a short-term dip. | ||
At $76.91 the stock trades above the $69.86 analyst target (upside of -9.2%), so the reward-to-risk ratio is negative at -1.83. Analyst target | Price should converge toward or below the analyst target, or the target should be raised, within ~12 months. | ↑Improving |
| CounterAnalyst targets lag; an earnings recovery in agricultural processing could drive upward target revisions and justify the current price. | ||
Quality score of 3.3 is below the 4.0 floor, with an earnings-quality warning of 66% FCF/NI and no competitive moat noted. Quality breakdown | Operating and net margins should improve and FCF conversion should rise toward 100% of net income if quality is recovering. | →Stable |
| CounterA Piotroski F-Score of 7/9 shows underlying financial health is solid, so low margins may reflect commodity cycle lows rather than structural weakness. | ||
Forward P/E of 13.5x and PEG of 0.92 suggest the earnings multiple is not stretched relative to expected growth. Valuation breakdown | Forward earnings should be delivered so that forward P/E stays near or below 13.5x as price holds. | ↑Improving |
| CounterForward estimates for a commodity processor are unreliable; if earnings disappoint, the multiple expands and the PEG advantage disappears. | ||
Revenue growth component scores 4.3/10 with low data confidence (0.33), indicating only modest top-line expansion. Components | Revenue growth should be sustained at positive mid-single-digit rates over the next 12 months. | →Stable |
| CounterLow-confidence growth data may understate true growth, but flat volumes and price deflation in grains could just as easily cause revenue declines. | ||
Momentum score is 3.9/10 with falling on-balance volume signalling distribution, despite the price holding above its 200-day moving average.
↓DeterioratingMomentum breakdown
- Expectation
- Momentum score should recover above 4.5 with volume accumulation if the trend is healthy.
CounterRSI near 36 in an uptrend pullback is described as a buy opportunity, so the weakness could be a short-term dip.
At $76.91 the stock trades above the $69.86 analyst target (upside of -9.2%), so the reward-to-risk ratio is negative at -1.83.
↑ImprovingAnalyst target
- Expectation
- Price should converge toward or below the analyst target, or the target should be raised, within ~12 months.
CounterAnalyst targets lag; an earnings recovery in agricultural processing could drive upward target revisions and justify the current price.
Quality score of 3.3 is below the 4.0 floor, with an earnings-quality warning of 66% FCF/NI and no competitive moat noted.
→StableQuality breakdown
- Expectation
- Operating and net margins should improve and FCF conversion should rise toward 100% of net income if quality is recovering.
CounterA Piotroski F-Score of 7/9 shows underlying financial health is solid, so low margins may reflect commodity cycle lows rather than structural weakness.
Forward P/E of 13.5x and PEG of 0.92 suggest the earnings multiple is not stretched relative to expected growth.
↑ImprovingValuation breakdown
- Expectation
- Forward earnings should be delivered so that forward P/E stays near or below 13.5x as price holds.
CounterForward estimates for a commodity processor are unreliable; if earnings disappoint, the multiple expands and the PEG advantage disappears.
Revenue growth component scores 4.3/10 with low data confidence (0.33), indicating only modest top-line expansion.
→StableComponents
- Expectation
- Revenue growth should be sustained at positive mid-single-digit rates over the next 12 months.
CounterLow-confidence growth data may understate true growth, but flat volumes and price deflation in grains could just as easily cause revenue declines.
Per-dimension breakdown
Quality
3.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 2.5 |
| ROA | 1.5 |
| Gross margin | 0.0 |
| Op margin | 1.6 |
| Net margin | 1.1 |
| Current ratio | 5.2 |
| FCF quality | 5.1 |
| Moat | 5.0 |
| Piotroski F | 7.8 |
- ▸Earnings quality warning: 66% FCF/NI
- ▸No competitive moat
- ▸Strong Piotroski F-Score: 7/9
Growth
4.3/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 4.3 |
Momentum
3.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 2.2 |
| Volume | 10.0 |
| vol acceleration | 2.6 |
- ▸Capitulation risk (RSI 9, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA but MA still rising (+4.4%/30d) — pullback in uptrend, not confirmed weakness
- ▸Volume surge (2.4x avg) on selloff
Sentiment
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.6 |
| Analyst rating | 5.0 |
| Price target | 7.0 |
Insider
5.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.5 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
5.6/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.0 |
| quality rank | 7.5 |
| growth rank | 5.0 |
- ▸Superior ROE vs peers
Technical
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 10.0 |
| support resistance | 9.2 |
| 52w position | 5.9 |
| gap | 6.0 |
Risk (lower is worse)
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.3 |
| days to cover | 7.1 |
| volatility | 5.0 |
| put call | 7.9 |
| implied vol | 4.7 |
| max pain risk | 7.0 |
| beta | 9.3 |
| debt equity | 8.4 |
Catalyst
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 6.5 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 9.1 |
| dividend safety | 6.0 |
| news activity | 8.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings today
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCK:QUALITY_FLOORPassed (4)
- INSIDER:OK
- NEWS_BOOST:EARNINGS:0.80
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.1<4.5
- ASYMMETRY:-0.2=NEGATIVE
- EARNINGS_PROXIMITY:0d<=7d
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.17
Upside
-1.0%
Downside
6.0%
Sizing output
AVOID
SetupOversold Bounce — Oversold RSI 9, near Bollinger lower, volume surge
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The SELL_IF_HOLDING verdict reflects the MOMENTUM gate's 3.1<4.5 outcome against Technical at 7.8 and asymmetric R:R of -0.17.
The strongest dimensions are Technical at 7.8, Catalyst at 7.4, and Risk (lower is worse) at 7.2; the weakest are Momentum at 3.1, Quality at 3.3, and Growth at 4.3. The V9 engine flagged 3 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.17 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Price Above Analyst Target
Trip ifShare price exceeds 15% above the analyst target of $69.86 without target revisions.
- P2Below Average Business Quality
Trip ifQuality score falls below 3.0 from current 3.3.
- P3Weak Negative Price Momentum
Trip ifMomentum score stays below 4.5 for 2 consecutive quarters.
- P4Reasonable Forward Valuation
Trip ifForward P/E rises above 18x from current 13.5x.
- P5Modest Revenue Growth
Trip ifRevenue growth falls below 0% YoY for 2 consecutive quarters.