Monsanto's Still Planting for the Future
These (among other things) have soured Monsanto's relationship not only with the farmers that rely on its seeds, but also with consumers who buy the produce.
However, even with all of the public bickering, investors who have planted their faith in Monsanto have not gone hungry. That the stock has posted gains of more than 17% on the year is a testament not only to strong management team, but also the extent to which Monsanto has differentiate its products from rivals DuPont
As of this writing, the stock is down more than 5% from a high of around $109 per share in May. The stock has taken a slight hit because not only did Monsanto report a worse-than-expected loss for its fiscal fourth quarter on Wednesday, but management also provided guidance that was below Street expectations. Investors have -- understandably -- become anxious. But I don't believe it's time to panic.
For instance, even with the 1.5% decline in overall revenue, sales of cotton seeds more than doubled to $65 million. What's more, that the Agriculture business continue to pose year-over-year double-digit gains (up 13.6%), management has plenty of time to shore up weakness in areas like soybeans. While it's true the company did report a higher operating loss, it's worth noting here that the fourth quarter has always known to be a seasonally weak period for the company.
To that end, those who are now proclaiming that Monsanto is "getting what it deserves" have to do a better job of explaining that actually means. Clearly, there are many who will disagree with me on this, but the way I see it Monsanto has always had a strong business.