Archer Daniels Midland (ADM) PT Raised to $95 at UBS as Market Underestimates Data Center Power Needs, Carbon Footprint
UBS analyst Manav Gupta raised the price target on Archer Daniels Midland (NYSE: ADM) to $95.00 (from $90.00) while maintaining a Buy rating.
The analyst commented, "We visited ADM's Decatur Plant with investors and met with multiple management members, following are takeaways AG services needs low maintenance capital, this makes a major cash contributor for the firm. QTD AG services is delivering strong performance. Demand for soybean meal continues to be strong both domestically and internationally, while bearish expectations around oversupply have not played out. Management highlighted its partnership with MPC, under which ADM operates the Green Bison facility in Spiritwood, North Dakota, processing local soybeans into soybean oil exclusively supplied to MPC for renewable fuels, while retaining and marketing the associated soybean meal through its global network. Market underestimates the power needs for data center and the carbon footprint it will create. This creates an opportunity set for ADM, one of the leading providers of Carbon Capture and Sequestration projects."