FMC shares poised for growth amid growing demand for agriculture News ad

Now that the latest US inflation and demand data has been released and the Federal Reserve has decided to cut interest rates for the third time in a row, a new cycle in agricultural and manufacturing stocks could begin. This is why today’s look at a key supplier in the industry becomes important for investors to consider further development.

Egg prices and their surge have surprised many investors in recent days following the release of the PPI index. While there are some stock picks that could lead investors to potential market growth in the coming months, now is the time to start looking at other verticals to maintain momentum in the agriculture sector. This is where fertilizer and machinery supplies come into play.

Of course, such promotions as Caterpillar Inc. New York Stock Exchange: CAT And Deere and Co. New York Stock Exchange: DE are a potential choice for increasing demand in the new agricultural cycle, not to mention other industries such as construction, as interest rates decline. However, before the machines and equipment reach the farms and fields, FMC company. New York Stock Exchange: FMC will likely be an early winner in this topic as a manufacturer of fertilizers and specialty chemicals, since this land requires preparation before cultivation.

Wall Street Analysts Recognize Growth Potential for FMC Stock

PMK today

$50.15 +2.29 (+4.78%)

(As of 12/20/2024 5:31 PM ET)

52 week range

$47.73

▼

$68.72

Dividend yield

4.63%

P/E ratio

4.32

Target price

$65.69

Fertilizer prices are falling, which means production costs for companies like FMC are also falling. Now that industry demand is returning, this is likely to boost the company’s earnings and revenue. The performance of manufacturing and services PMIs reinforces this theme.

Of all the industries in these sectors, the trend favors the chemical and agricultural industries combined, giving an advantage to companies like FMC today. This can be seen in the current earnings per share (EPS) forecasts for the next 12 months issued by Wall Street.

Analysts are forecasting earnings per share to rise to $0.98 next year, which would represent a significant jump of 42% from today’s $0.69. This extension is enough to keep the tick price moving in the coming months, so other analysts are willing to express their bullish views through ratings and price targets.

Mizuho officials were bold enough to lead the group as of November 2024, as they valued the company at $70 per share, up from the previous estimate of $64 per share. To prove this new valuation, FMC shares would need to rise as much as 42.5% from where they are trading today, which is also in line with current EPS forecasts for next year.

Markets agree with this view: what comparable companies look like

Knowing what Wall Street thinks about a stock is only half the battle; the other half is finding out what Main Street thinks about the stocks in question. Investors can evaluate this aspect by checking out FMC stock and how it stacks up against peers such as Mosaic Company. New York Stock Exchange: MOS And CF Industries Inc. New York Stock Exchange: CF.

In terms of earnings growth, FMC’s EPS growth is 42% higher than the 0.5% decline expected for Mosaic shares and the 6% contraction for CF Industries. This opens up the possibility of FMC being preferred over its peers in the fertilizer and specialty agricultural chemicals industry in the near future.

Then comes the fact that State Street decided to increase its institutional holdings in FMC shares by 27.3% as of November 2024, bringing their net position to a maximum of $417.1 million or 5% ownership in the company. This gives investors another bullish indicator to consider when developing a potential purchase.

There’s a reason, beyond analysts’ EPS forecasts, to believe FMC stock is up today, and it has to do with its new management strategy. FMC management just added Anthony DiSilvestro, a man who has years of experience as the company’s chief financial officer (CFO), to the company’s board of directors. Mattel Inc. NASDAQ:MAT to effectively implement the cost reduction plans currently underway at FMC.

If successful, this program will provide a further tailwind for FMC stock as the impact of these cost-cutting initiatives may not yet be reflected in today’s earnings per share forecasts. This is another factor that investors should consider in the current theme surrounding FMC stock.

The final check can be made by looking at other verticals in the agriculture value chain, and this is where Caterpillar and Deere stocks come into play. As for Caterpillar, JP Morgan Chase analysts felt confident enough in these trends to maintain an Overweight rating on Caterpillar shares and a $515 per share price target, suggesting upside potential of up to 41.5% from today’s levels.

The trend continues for Deere stock, as Jefferies Financial Group sees a $510 valuation for the company, with potential for 20% upside from today’s levels. The fact that Wall Street is bullish on two verticals of the same industry should give investors the confidence needed to act on the PMI and PPI trends of recent weeks, and FMC is the exception.

Before you consider FMC, you should hear this.

MarketBeat tracks Wall Street’s top-rated and best-performing analysts daily and the stocks they recommend to their clients. MarketBeat identified five stocks that top analysts were quietly telling their clients to buy now, before the broader market caught on… and FMC wasn’t on the list.

While FMC currently has a Hold rating among analysts, the top-rated analysts think these five stocks are Strong Buys.

View five stocks here

Unlock the eternal value of gold with our exclusive 2025 Gold Forecasting Report. Find out why gold remains the best investment for protecting wealth from inflation, economic shifts and global uncertainty. Whether you are planning for the future for future generations or looking for a reliable asset in turbulent times, this report will be your essential guide to making informed decisions.

Get this free report

Did you like this article? Share this with a colleague.

The link has been copied to the clipboard.