New Trade for March 14th, 2023

Stocks were looking to recover losses this morning from a volatile previous session following the Signature Bank and Silicon Valley Bank failures. More volatility can be expected as investors process history’s second and third-biggest bank failures. However, consumer price data released this morning soothed market sentiment as it came in primarily in line with expectations. 

As of Monday, traders saw an 85% probability that the Federal Reserve would raise rates a quarter point at its next policy meeting scheduled for March 21-22. Although some think Fed officials might hold off, for now, prioritizing financial stability after high-profile bank failures rattled the financial system.

Despite challenging conditions, analysts expect our recommendation for today to climb more than 40% over the next year. Its defensive nature and global presence should help fortify earnings, regardless of the Fed’s next move.   



Archer-Daniels-Midland 

Stronger-than-anticipated results from South America have helped it post robust top and bottom-line numbers in recent quarters. In its fourth quarter, sales and operating profits were up 13.6% and 18%, respectively. Surprisingly, ADM stock trades at 0.4 times forward sales estimates, roughly 62% lower than the sector average. ADM has a yield of 2.31% and boasts an A-graded dividend profile, demonstrating dividend growth for 50 consecutive years. Moreover, its forward dividend per share growth of 7.4% is more than 40% higher than the sector average.

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