Monsanto: Aggressive Growth Buy Alert

Monsanto Co.[[mon]] has been pleasing its shareholders by producing record sales and executing its share buy-back program. The company’s third-quarter results were awesome, including a big jump in both revenue and earnings. Monsanto has also increased its international exposure through the acquisition of a Guatemalan seed company.

Company Description

Monsanto Co. is a specialty seed producer and residential lawn care product provider. The company has a history dating back to 1901 before being spun off as an independent company in 2002. Monsanto carries a market cap of over $64 billion.

A Record-Setting Quarter

Monsanto announced excellent third-quarter results on June 25 that included record net sales of $3.6 billion, up 26% from this time last year. Net income spiked to $811 million, up from $570 million in the same quarter last year, an 83% increase. This produced earnings of $1.45 per share, topping analyst estimates of $1.35 per share.

Positive Outlook

With a great quarter on the books, Monsanto raised its full-year guidance and now anticipates more than doubling its gross profits by 2012. It has also increased its divided to 24 cents per share, up from 17.5 cents last quarter. The company has repurchased $429 million of the $800 million in shares it intends to repurchase by October 2009.

World Wide Regulatory Approvall

The company’s newest product is on pace to hit the market in 2009, as scheduled, based on regulators’ approval in Australia and Mexico, as well as a positive scientific opinion in Europe. Roundup Ready 2 Yield Soybeans, will provide farmers increased crop yields though superior weed control.

Good Position in the Industry

The company’s ROE, 22.43%, trumps the industry average of 7.79%. Monsanto’s projected growth for next year of 28.5% is about 2.5 times the projected growth rate of it’s peers.

Aquisition in Central America

Earlier this month Monsanto completed the acquisition of Semillas Cristiani Burkard, the leading seed company in the Latin American Tropics. SCB is headquartered in Guatemala and has relationships with over 900 regional dealers. The acquisition expanded Monsanto’s world wide reach further into Central America.

Expanding its Facilities

Monsanto announced on April 2nd that it will be expanding it’s Luling, Louisiana plant, which will increase the facilities Roundup herbicide production by 20%.

Subscribe by RSS Subscribe by Email