Monsanto Earnings Are In: Hits And Misses (MON)

In the world of agribusiness, there is no name more prolific then Monsanto Company (MON) – the world’s leading producer of the herbicide glyphosate and the second biggest producer of genetically engineered seeds. With a market cap of over $54 billion, investors pay close attention to this bellwether, following the company’s news and key earnings report [for more agricultural news and analysis subscribe to our free newsletter].

On Wednesday before the opening bell, Monstanto reported its third quarter earnings report, posting both hits and misses. The company managed to beat earnings estimates, but quarterly profit and sales missed the mark.

Weak Seed Sales and Higher Costs Hinder ProfitMonsanto

In its third quarter, Monsanto reported a profit of $909 million, or $1.68 per share, down from last year’s $937 million recording. Earnings from continuing operations, however, came in at $1.66 per share, up from $1.63 a year earlier and above the estimated $1.60 figure.

Net sales inched 0.7% higher in the third quarter to $4.25 billion, below the forecasted $4.41 billion. The company’s seed and genomics business – its largest revenue contributor – saw a 2.4% decline in sales to $3.05 billion, mainly driven by declines in cotton and soybean.

Also in its report, Monsanto slightly raised its outlook for 2013. The bellwether expects earnings to come in between $4.50 and $4.55 per share [see Long-Term Trend Reversal Alert For Apache Corp. (APA)].

Quoted in the company’s press release, CEO of Monsanto Hugh Grant discussed the latest results: “Our optimism reflects the expanding opportunity we see to unlock successive layers of growth next year and beyond as our focus on farmers, new product platforms and operating efficiency combine to build continued momentum.”

This month, however, Monsanto found itself in hot water after unapproved genetically modified wheat was discovered in an Oregon field by Oregon State University and the USDA. Though the company stressed that this was an isolated incident caused by some kind of sabotage, shares of Monsanto took a significant beating, falling more than 5.8% in one week. Year-to-date, however, the stock is up nearly 5.5%:


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Disclosure: No positions at time of writing

About Daniela Pylypczak

Daniela Pylypczak-Wasylyszyn is a regular contributor to, where she primarily focuses on commodity producers equities. She is also an analyst for, where she contributes articles and analysis each week. Since joining the team in 2011, Daniela has quickly grown to be one of the most widely-followed authors in the industry. Her articles are syndicated in a number of online publications, including Financial Advisor Magazine,, and Yahoo! Finance. Daniela is also a contributor for and Daniela graduated from DePaul University with a bachelor’s degree in finance and economics.
This entry was posted in Agriculture, Asset Allocation, Commodity Producers, Corn, Cotton, Earnings, Earnings Reports, Soybeans, Wheat and tagged . Bookmark the permalink.

Commodity HQ is not an investment advisor, and any content published by Commodity HQ does not constitute individual investment advice. The opinions offered herein are not personalized recommendations to buy, sell or hold securities or investment assets. Read the full disclaimer here.

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