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Monsanto Shares Rise on Q3 Results (MON)

Shares of Monsanto Company (NYSE: MON), a provider of agricultural products for farmers, rose sharply on Wednesday after the company announced strong third-quarter financial results.

Monsanto, which is the world’s largest seed company, reported a profit of $937 million, or $1.74 per share for the quarter ended May 31, 2012, compared to a profit of $692 million, or $1.28 per share reported for the same period in the previous fiscal year. Excluding one-time items, MON reported a profit of $1.63 per share, compared to $1.28 per share reported for the same period last year. The company’s adjusted profit for the quarter beat its own estimates by a penny.

Net sales for the quarter rose 17% to $4.22 billion, beating analysts’ estimate of $4 billion. The company’s seed business posted an 18% increase in sales for the quarter. The growth in the seed business was driven by corn and soybean portfolios. This was partially offset by weaker earnings in the company’s vegetable-seed business. The company’s cotton sales rose marginally.

Hugh Grant, CEO of Monsanto, said that the company plans to see a 5% to 10% increase in prices for its corn seeds as farmers switch to higher-end seeds. Grant also said that seed pricing for next year is largely decoupled from commodity prices and wont see any significant fluctuations based on the price of corn.

Monsanto also reiterated its guidance for the full year. The company continues to expect full-year earnings to be between $3.65 per share and $3.70 per share.

Monsanto shares rose to an intra-day high of $81.41 on Wednesday. The stock ended the day 3.88% higher at $80.89 on above average volume of 5.74 million. Year-to-date, the stock gained 15.44%, outperforming the S&P 500, which gained 5.90% in the same period.


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