Archer Acquires Cattleman's Choice - Analyst Blog
June 07 2011 - 4:00AM
Zacks
Archer Daniels Midland
Company’s (ADM) wholly owned subsidiary ADM Alliance
Nutrition indicated that it has entered into an agreement to
acquire Cattleman’s Choice Loomix, which is a leading producer of
liquid animal feed supplements. The acquisition will allow the
company to penetrate into the Western United States market while
providing an opportunity to explore the liquid feed business.
Headquartered in Johnstown, Colo,
Cattleman’s Choice Loomix manufactures the Loomix brand liquid feed
supplement for ruminants. Moreover, it also entered into an
agreement with a toll manufacturer in Fremont, Neb.
Recently, Archer Daniels reported
robust third-quarter 2011 results. Net income for the reported
quarter came in at $578.0 million or 86 cents per share compared
with $421.0 million or 65 cents per share in the year-ago quarter.
Quarterly earnings also outpaced the Zacks Consensus Estimate by a
penny.
Archer Daniels is in the midst of a
brisk expansion strategy, which includes increasing its crushing
capacities in North America, and fertilizer blending and biodiesel
capacities in South America. Moreover, in Europe, the company has
acquired processing facilities in Czech Republic and Germany. These
initiatives offer a strong upside potential to the company.
In addition, Archer Daniels is one
of the leading players in the global food processing industry and
commands a massive network of more than 560 processing and sourcing
facilities and 27,000 vehicles operating across the Americas,
Europe and Asia for transportation of agricultural commodities.
This provides a strong competitive advantage to the company and
strengthens its well-established position in the market.
Archer Daniels, which competes with
Bunge Limited (BG) and Corn Products
International Inc. (CPO), currently has a Zacks #3 Rank,
implying a short-term Hold rating on the stock. Besides, the
company retains a long-term Neutral recommendation.
ARCHER DANIELS (ADM): Free Stock Analysis Report
BUNGE LTD (BG): Free Stock Analysis Report
CORN PROD INTL (CPO): Free Stock Analysis Report
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