Financial Trading Blog
Stock of the day 23/06/2016 – Monsanto Co
Up until the middle of May Monsanto wasn’t enjoying a particularly stellar 2016. Its Q1 figures at the start of January only exacerbated its early in the year decline, with the company cutting another 1000 jobs on top of the 3600 announced the previous October following a quarterly loss of $253 million off of a 23% slide in sales to $2.2 billion. The stock continued to bounce between $85 and $95 as the year went on, its Q2 report even more of a damp squib that the update in January, Monsanto seeing a total sales drop of 13% to $4.53 billion alongside a 26% drop in profits to $1.06 billion (both missing analysts’ estimates).
(Source: IT-Finance.com 23/06/2016)
Yet Monsanto’s year completely changed on May 12th, as it was revealed that German giant Bayer was exploring a $40 billion bid for the company that would create the world’s largest supplier of seeds and farm chemicals. This sent Monsanto shooting up over 10% to $103, a price the stock hadn’t seen since August 2015, before climbing even higher as Bayer revealed a super-sized $62 billion bid. Interestingly Monsanto continued to rise even as it rejected that $122 per share offer, eventually hitting a 2016, and 12 month, peak of $113.17 by the end of May. Monsanto sits at a current trading price of $107.11 (IT-Finance.com, 23/06/2016).
In terms of Monsanto’s third quarter report investors will likely be more interested to hear about any progress with Bayer (with the two companies still open to talks) than they will the company’s actual figures. However, the stock may still be in for a bit of a fall if it sees yet another update that misses estimates, especially since its sales decline has shown no sign of slowing down.
Monsanto Co has a consensus rating of ‘Hold’ with an average target price of $105.53.
It's easy to open an account
- Fill in our simple online application form
- Fund your account
- Start trading the global markets instantly!
SEARCH FOR AN ARTICLE:
Enter a keyword and search for all relevant articlesMARKET ANALYSIS
RECENT POSTS
DISCLAIMER
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64% of retail investors lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work and whether you can afford to take the high risk of losing your money. For professional clients, spread betting and CFD trading can also result in losses larger than your initial stake or deposit.
Spreadex Ltd is authorised and regulated by the Financial Conduct Authority, provides an execution only service and does not provide advice in any way. Nothing within this update should be deemed to constitute the provision of investment advice, recommendations, any other professional advice in any way, or a record of our trading prices. This update does not constitute or form part of an offer of, or solicitation for a transaction in any financial instrument, nor shall it or the fact of its distribution form the basis of, or be relied on in connection with, any contract therefore. Any persons placing trades based on their interpretation of the comments or information within this update does so entirely at their own risk.
No representation, warranty, or undertaking, express or limited, is given as to the accuracy or completeness of the information or opinions contained within this update by Spreadex Ltd or any of its employees and no liability is accepted by such persons for the accuracy or completeness of any such information or opinions. As such, no reliance may be placed for any purpose on the information and opinions contained within this update.
The information contained within this update is the intellectual property of Spreadex Ltd and is protected by UK and International copyright laws. All rights reserved. Users may however freely download, distribute and reproduce extracts of the contents, subject always to accrediting Spreadex Ltd as the source and providing a hyperlink to www.spreadex.com.
