Citi analyst Thomas Palmer raised the firm’s price target on Archer Daniels (ADM) to $55 from $51 and keeps a Neutral rating on the shares. The firm says it came away from ADM’s Q3 earnings call with a better understanding of the company’s nearer-term challenges and opportunity to mitigate cyclical headwinds with operational improvements. It sees opportunity for ADM’s earnings to benefit from higher crush volumes, the restart of Decatur East, operational and demand recovery in the Human Nutrition segment, and capital deployments. However, Citi is not sure that much recovery in the agriculture products industry should be anticipated, especially when considering the mounting headwinds on crush margins and refined oil spreads.
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