Monsanto (NYSE:MON) Materials - Chemicals | Reports June 29, Before Market Opens
Key Takeaways
- The Estimize consensus is looking for earnings per share of $2.44 on $4.42 billion in revenue this quarter, 3 cents higher than Wall Street on the bottom and $9 million below on the top
- The biggest news out of Monsanto this quarter has been a potential merger with Bayer AG NA (DE:BAYGN), (OTC:BAYRY)
- Monsanto’s continued investments in inorganic products are doing well but have rubbed environmentalists and the agriculture industry the wrong way
- What are you expecting for MON?
Monsanto (MON), the leader in agrochemical and agricultural biotechnology, is scheduled to report FQ3 2016 earnings Wednesday, before the opening bell. Chemically and genetically modified products have been a point of contention the past 5 years, causing many agricultural companies to abandon their traditional means of harvesting.
However, Monsanto remains stuck in its ways and continues to mass produce chemically infused products. As a result Monsanto has missed its revenue target in 6 consecutive quarters.
The Estimize consensus is looking for earnings per share of $2.44 on $4.42 billion in revenue this quarter, 2 cents higher than Wall Street on the bottom and $9 million below on the top.
Compared to a year earlier this reflects a 2% increase in earnings with sales expected to fall 3%. Fortunately the stock typically is a positive mover after reporting results, which should reconcile some of its losses of the past 12 months.
The biggest news out of Monsanto this quarter has been a potential merger with Bayer AG. In May, Bayer proposed a takeover bid of $122 per share which Monsanto deemed insultingly low.
While the two names are at odds, the pieces are still in motion for a potential takeover later this year. Since speculation started, shares have surged 25% as investor’s fear missing out. Meanwhile the company continues to engage in strategic partnerships. Just ahead of earnings Monsanto announced partnerships with Sumitomo.
Despite the looming takeover, the company remains exposed to various macroeconomic risks. The economic slowdown in China, a downturn in the agricultural industry, lower agricultural prices and the strength of the U.S. dollar will likely drag down earnings. Based on some of these issues, Monsanto had lowered its fiscal 2016 earnings guidance nearly 50 cents. 
Do you think MON can beat estimates?