Archer-Daniels-Midland Company (ADM) is set to trade ex-dividend on August 20th, with a payment of $0.51 per share on September 10th. The company paid a total of $2.04 per share in the last 12 months, yielding 3.4% on the current share price of $59.32. ADM's dividend is covered by both profits and cash flow, indicating sustainability. However, it is essential to be cautious of the risk of a drop in earnings.
Archer-Daniels-Midland Company (ADM), a prominent player in the food and beverage sector, is set to trade ex-dividend on August 20th, 2025. The dividend payment of $0.51 per share is scheduled for September 10th, 2025. Over the past 12 months, ADM has paid a total of $2.04 per share, resulting in a dividend yield of 3.4% based on the current share price of $59.32.
ADM's dividend is well-covered by both earnings and cash flow, indicating a sustainable payout. The company's dividend yield of 3.4% is higher than the bottom 25% of dividend payers in the US market (1.48%) but lower than the top 25% (4.52%) [1]. The payout ratio stands at 89%, which is covered by earnings, and the cash payout ratio is 23.9%, indicating robust coverage by cash flows.
Investors should note that while ADM's dividend is stable and growing, there is a risk of a drop in earnings. Recent earnings reports have shown that ADM's earnings and revenues have missed analyst expectations on multiple occasions [2]. Additionally, the company has faced challenges with commodity prices and earnings quality [3].
Despite these challenges, ADM's strong dividend history and consistent payouts make it an attractive option for income-oriented investors. The company's acquisition strategy and focus on sustainable agriculture also provide long-term growth prospects. However, investors should remain vigilant and monitor earnings reports closely to assess the company's performance and potential dividend cuts.
References:
[1] https://simplywall.st/stocks/us/food-beverage-tobacco/nyse-adm/archer-daniels-midland/dividend
[2] https://simplywall.st/stocks/us/food-beverage-tobacco/nyse-adm/archer-daniels-midland/dividend
[3] https://simplywall.st/stocks/us/food-beverage-tobacco/nyse-adm/archer-daniels-midland/dividend
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