Monsanto Looking Good After Better-Than-Expected Earnings Amidst Low Corn Seed Sales Environment

Monsanto Company MON beat (some say, crushed) Wall Street estimates for its fiscal first-quarter earnings on Wednesday, even though it reported lower revenue and profit than the same quarter last year, mainly due to lower corn seed sales.

Following the earnings beat and a few positive ratings from major Wall Street research firms, the stock gained about 1.69 percent on Thursday trading. So, what are analysts saying?

Analyst Ratings

Deutsche Bank remains bullish, as it reiterated a Buy rating and raised its price target for the stock, from $130 to $132. This implies an upside potential of more than 10 percent from the current stock price of $119.19 per share.

Also bullish on the company is JP Morgan Chase & Co., which also maintained its Overweight rating, accompanied by a price target of $125, up from its previous price target of $120.

Unlike the aforementioned research firms, Miller Tabak remains cautious, maintaining a Neutral rating for the stock. The firm had downgraded the company on Christmas Eve. However, analysts, in average, rate it as a Buy.

What About China?

Recent news about China’s Ministry of Agriculture having approved genetically engineered corn produced by Switzerland’s Syngenta AG bodes well for the whole agricultural sector. This first step opens the door for U.S. shipments to resume in the near future.

With corn trading at multi-year lows, and farmers cutting costs, downsizing and shifting their focus to other crops, the Chinese market could prove crucial.