When it comes to agribusiness stocks, there is perhaps no name bigger than Monsanto Company (MON) – the world’s leading producer of the herbicide glyphosate and the second biggest producer of genetically engineered seeds. Headquartered in St. Louis, the firm has grown into an over $55 billion company, with operations spanning across the U.S., Europe, Africa, Brazil, Asia-Pacific, Argentina, Canada and Mexico [for more agricultural news and analysis subscribe to our free newsletter].
On Wednesday, the bellwether reported an impressive second quarter earnings report, beating Wall Street expectations by a considerable amount. Monsanto’s fiscal Q2 earnings rose an incredible 22%, driven largely by strength in its global corn and herbicide business as well as increased demand from emerging market economies.
Monsanto raised its full-year earnings estimate by 10 cents, shifting the full-year EPS estimate range to between $4.40 and $4.50 a share; the company’s previous target range was $4.30 to $4.40 per share.
In its report, Monsanto also stated it earned $1.48 billion in profits, or $2.74 a share, in the three months ended February 13, 2013; analysts polled by Thomson Reuters had forecasted earnings of $2.58 per share. The company’s sales increased 15% to $5.47 billion, largely due to an increase in its genetically modified corn seeds sales. Monsanto also noted that it benefited from both increased volumes and higher selling prices in South America, a corner of the world that is rapidly adopting genetically modified seeds [see How Ags Will React To Last Year's Drought].
Quoted in the company’s press release, CEO of Monsanto Hugh Grant discussed the latest results: “Our commitment to serving our farmer customers around the world is at the core of everything we do, by understanding their needs and finding new ways to work with them to meet growing demand, we’ve achieved momentum in our business and strong results across our global portfolio.”
Reflecting this notion, shares of Monsanto have risen more than 8% year-to-date, and are up over 40% in the trailing two-year period.
Disclosure: No positions at time of writing.