Head to Head Survey: Archer Daniels Midland (NYSE:ADM) vs. Corteva (NYSE:CTVA)

Corteva (NYSE:CTVA) and Archer Daniels Midland (NYSE:ADM) are both large-cap consumer staples companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, dividends, profitability, risk, earnings, valuation and institutional ownership.

Institutional and Insider Ownership

81.5% of Corteva shares are owned by institutional investors. Comparatively, 78.3% of Archer Daniels Midland shares are owned by institutional investors. 0.1% of Corteva shares are owned by company insiders. Comparatively, 1.2% of Archer Daniels Midland shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings for Corteva and Archer Daniels Midland, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Corteva	0	7	13	2	2.77
Archer Daniels Midland	3	5	1	0	1.78

Corteva currently has a consensus price target of $82.30, suggesting a potential upside of 8.00%. Archer Daniels Midland has a consensus price target of $58.00, suggesting a potential downside of 14.50%. Given Corteva’s stronger consensus rating and higher possible upside, equities analysts clearly believe Corteva is more favorable than Archer Daniels Midland.

Profitability

This table compares Corteva and Archer Daniels Midland’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Corteva	6.29%	9.06%	5.39%
Archer Daniels Midland	1.34%	7.39%	3.17%

Risk & Volatility

Corteva has a beta of 0.75, indicating that its stock price is 25% less volatile than the S&P 500. Comparatively, Archer Daniels Midland has a beta of 0.71, indicating that its stock price is 29% less volatile than the S&P 500.

Earnings and Valuation

This table compares Corteva and Archer Daniels Midland”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Corteva	$17.40 billion	2.95	$1.09 billion	$1.58	48.23
Archer Daniels Midland	$80.27 billion	0.41	$1.08 billion	$2.22	30.56

Corteva has higher earnings, but lower revenue than Archer Daniels Midland. Archer Daniels Midland is trading at a lower price-to-earnings ratio than Corteva, indicating that it is currently the more affordable of the two stocks.

Dividends

Corteva pays an annual dividend of $0.72 per share and has a dividend yield of 0.9%. Archer Daniels Midland pays an annual dividend of $2.08 per share and has a dividend yield of 3.1%. Corteva pays out 45.6% of its earnings in the form of a dividend. Archer Daniels Midland pays out 93.7% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Corteva has raised its dividend for 5 consecutive years and Archer Daniels Midland has raised its dividend for 53 consecutive years. Archer Daniels Midland is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Summary

Corteva beats Archer Daniels Midland on 13 of the 18 factors compared between the two stocks.

About Corteva

Corteva, Inc. operates in the agriculture business. It operates through two segments, Seed and Crop Protection. The Seed segment develops and supplies advanced germplasm and traits that produce optimum yield for farms. It offers trait technologies that enhance resistance to weather, disease, insects, and herbicides used to control weeds, as well as food and nutritional characteristics. This segment also provides digital solutions that assist farmer decision-making with a view to optimize product selection, and maximize yield and profitability. The Crop Protection segment offers products that protect against weeds, insects and other pests, and diseases, as well as enhances crop health above and below ground through nitrogen management and seed-applied technologies. This segment provides herbicides, insecticides, nitrogen stabilizers, and pasture and range management herbicides. It serves agricultural input industry. The company operates in the United States, Canada, Latin America, the Asia Pacific, Europe, the Middle East, and Africa. Corteva, Inc. was incorporated in 2018 and is headquartered in Indianapolis, Indiana.

About Archer Daniels Midland

Archer-Daniels-Midland Company engages in the procurement, transportation, storage, processing, and merchandising of agricultural commodities, ingredients, flavors, and solutions in the United States, Switzerland, the Cayman Islands, Brazil, Mexico, Canada, the United Kingdom, and internationally. It operates in three segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition. The company originates, merchandises, stores, and transports agricultural raw materials, such as oilseeds and soft seeds. It also engages in the agricultural commodity and feed product import, export, and distribution; and various structured trade finance activities. In addition, the company offers soybean meal and oil; vegetable and salad oils and protein meals; ingredients for the food, feed, energy, and industrial customers; margarine, shortening, and other food products; and partially refined oils to produce biodiesel and glycols for use in chemicals, paints, and other industrial products. Further, it provides peanuts, peanut-derived ingredients, and cotton cellulose pulp; sweeteners, corn and wheat starches, syrup, glucose, wheat flour, and dextrose; alcohol, and other food and animal feed ingredients; ethyl alcohol and ethanol; corn gluten feed and meal; distillers' grains; corn germ; and citric acids. Additionally, the company provides proteins, natural flavors, flavor systems, natural colors, emulsifiers, soluble fiber, polyols, hydrocolloids, probiotics, prebiotics, postbiotics, enzymes, and botanical extracts; and other specialty food and feed ingredients; edible beans; formula feeds, and animal health and nutrition products; and contract and private label pet treats and food products. It also offers futures commission merchant; commodity brokerage services; cash margins and securities pledged to commodity exchange clearinghouse; and cash pledged as security under certain insurance arrangements. The company was founded in 1902 and is headquartered in Chicago, Illinois.