Food processing and commodities trading corporation The Archer-Daniels-Midland Company (NYSE: ADM), popularly known as ADM, recently revealed that it has acquired Flavor Infusion International, S.A., a flavor and specialty ingredient solutions provider.
The terms of the deal were not disclosed. Following the news, ADM shares declined marginally to close at $64.62 during the extended trading session.
Strategic Impact
This acquisition of Flavor Infusion by ADM will allow the company to gain a position of strength in the Latin America and the Caribbean markets. Flavor Infusion remains a prominent market player in these markets, and serves a wide range of flavorful offerings to a sizable number of customers across the region.
Management Commentary
President of ADM’s Nutrition business, Vince Macciocchi, said “We’re excited to open up new growth opportunities in Latin America and the Caribbean with the addition of FISA. This acquisition represents another important bolt-on addition as we expand our capabilities in this high-value segment.”
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Analyst Ratings
Recently, Barclays analyst Benjamin Theurer reiterated a Buy rating on the stock. The analyst, however, raised the price target from $75 to $82, which implies upside potential of 26.9% from current levels.
The Street is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 4 Buys and 2 Holds. The average ADM price target of $72.50 implies the stock has upside potential of 12.2% from current levels. Shares have gained about 30.9% over the past year.
Investors
TipRanks’ Stock Investors tool shows that investors currently have a Very Positive stance on ADM. Further, 5.5% of portfolios tracked by TipRanks, reduced their exposure to ADM stock over the past 30 days.
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