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Monsanto Company (MON): New Analyst Report from Zacks Equity Research - Zacks Equity Research Report

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Summary:

Monsanto reported adjusted earnings of $0.47 per share in first-quarter fiscal 2015. Earnings surpassed the Zacks Consensus estimate by 38.2%, but missed the year-ago tally by 29.9%. Moreover, the company reported revenues of $2,870 million, down 8.7% from the year-ago quarter. The year over year fall in the bottom line was due to adverse effects of market uncertainties, threats of business rivalry and high research & development expenses. However, falling crude oil prices have proved to be beneficial for an energy intensive agricultural stock like Monsanto. Also, the organization aims to reduce its operational expenses and enhance its gross productivity on the back of superior technological innovations in the upcoming quarters. Based on the above factors, we prefer to maintain a Neutral recommendation on the stock.

Overview:

Missouri-based Monsanto Company (MON), together with its subsidiaries, is a leading global provider of agricultural products. It has two segments: Seeds and Genomics, and Agricultural Productivity.

The Seeds and Genomics segment (67.7% of Total Revenue for Fiscal 2014) produces corn, soybeans, canola and cotton seeds, as well as vegetable and fruit seeds, including tomato, pepper, eggplant, melon, cucumber, pumpkin, squash, beans, broccoli, onions and lettuce. This segment also develops biotechnology traits that assist farmers in controlling insects and weeds along with providing genetic material and biotechnology traits to other seed companies.

The Agricultural Productivity segment (32.3%) consists of other glyphosate-based herbicides for agricultural, industrial, ornamental and turf applications lawn-and-garden herbicides for residential lawn-and-garden applications and other herbicides for control of pre-emergent annual grass and small-seeded broadleaf weeds in corn and other crops.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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