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On Wednesday, Mizuho (NYSE:MFG) Securities maintained a Neutral rating on FMC Corp . (NYSE:FMC) but reduced the price target to $51 from the previous $55. The adjustment follows the company’s acknowledgment of broader challenges than initially expected. Currently trading at $54.04, InvestingPro analysis suggests FMC is slightly undervalued, with 7 analysts recently revising their earnings expectations downward. The stock offers a notable 4.29% dividend yield, having maintained dividend payments for 19 consecutive years.
The CEO of FMC Corp. has recognized that the issues confronting the company are more extensive than previously thought. This realization comes as the company is navigating through various operational difficulties, reflected in a significant 16% year-over-year revenue decline. Specifically, the CEO pointed out the complexity of establishing the right distribution channels, especially in Latin America, which now necessitates investment in a new sales organization to enable a more direct engagement with customers.
Additionally, the company is facing the task of managing and defending its diamide franchise after the expiration of patents, a challenge that is expected to be demanding. With competitive pressures mounting, Mizuho analysts believe that FMC Corp. will need to undertake more aggressive actions to reposition itself in the market. Despite these challenges, InvestingPro data shows the company maintains strong profitability metrics, with detailed analysis available in the comprehensive Pro Research Report covering this and 1,400+ other top stocks.
Mizuho has also revised its estimates for the company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) for the years 2025 and 2026. The new forecast anticipates EBITDA to be $913 million in 2025 and $1.03 billion in 2026, which is a decrease of approximately 12% from the previous estimates of $1.04 billion and $1.18 billion, respectively.
The firm’s analysts have highlighted that successful execution and management through the current challenging environment will be crucial for FMC Corp. to regain credibility. Management has acknowledged the significant amount of work that lies ahead to address these issues.
In other recent news, FMC Corp has been the focus of analyst downgrades and revised price targets following a disappointing Q4 earnings report and a cautious outlook for 2025. RBC Capital downgraded FMC from Outperform to Sector Perform, slashing the price target to $47, citing excess inventory and a slowdown in purchases by U.S. farmers. They also revised their EBITDA estimates for FMC downward for Q1 and the full year of 2025.
Similarly, Morgan Stanley (NYSE:MS)’s Vincent Andrews reduced the price target for FMC to $46 while maintaining an Equalweight rating. Andrews highlighted several conditions that could potentially rekindle investor interest, including meeting its EBITDA guidance for 2025 and addressing the issue of elevated channel inventory.
The company reported Q4 earnings that beat estimates, but revenue fell short, and the 2025 guidance was weaker than expected. FMC posted adjusted earnings of $1.79 per share for Q4, but revenue of $1.22 billion missed projections. The company expects full-year adjusted earnings per share of $3.26 to $3.70 in 2025, with revenue guidance of $4.15 billion to $4.35 billion.
These are recent developments in the company’s financial performance and outlook as it faces headwinds in the coming year. Despite the challenges, FMC highlighted strong cash generation in 2024, with cash flow from operations improving to $737 million and free cash flow reaching $614 million.
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