Raising Archer-Daniels Midland's FVE on Improved Near-Term Outlook; Shares Significantly Overvalued

Archer-Daniels Midland reported strong first-quarter earnings as segment operating profit was up 28% versus the prior-year quarter. The growth was driven by higher results in all segments. We have increased our near-term outlook for the firm in all three segments, as we now forecast stronger revenue growth and higher profitability. Our long-term outlook remains intact. Having updated our model to reflect these changes, we raise our fair value estimate to $65 per share from $55. Our no-moat rating is unchanged.