Archer-Daniels-Midland Stock (ADM) Q2 2026 Earnings: A 23% Beat Washington Wrote

Archer-Daniels-Midland Company (ADM) Q2 2026 — Q2 2026 (3 months ended June 30, 2026): adjusted diluted EPS $1.84 vs a $1.49 bar - a 23.5% BEAT, up 98% year on year. U.S. GAAP EPS was $1.87 - HIGHER than adjusted, so this beat is not an add-back. Revenue $22,681M, up 7.2%, a 0.3% MISS. Total segment operating profit $1,450M, up 75%. Full-year adjusted EPS guidance RAISED from $4.15-$4.70 to $5.15-$5.60. The 8-K was accepted 6:03am ET, BEFORE the open: the stock closed +2.32% at $79.87, then $77.58, $77.51 and $76.59 - below its own $78.06 pre-print price three sessions later. Archer-Daniels-Midland beat the adjusted EPS bar by 23.5% and raised the implied second half of its own year by 95 cents against a 35-cent beat. We tried to falsify both and failed. The question is what multiple you pay for it. Decompose the $620M increase in segment operating profit and Crushing alone is $330M - 53% - with Vantage Corn ethanol another $52M, so 61.6% comes from two lines sitting directly downstream of the 2026 and 2027 renewable volume obligations the EPA finalized in March 2026. ADM names that mandate as the cause three separate times in its own release. And on the trailing four quarters that CONTAIN this blow-out, ADM's own release puts adjusted return on invested capital at 7.8%. THE CALL: SELL (3/5, FAIR VALUE $62 vs THE $76.59 CLOSE - 19% BELOW THE PRICE AND 29% BELOW WALL STREET) — base-case value ~$62.0 vs ~$76.59 today. KEY METRICS: - CALL: SELL 3/5, fair value $62 vs the $76.59 Aug 7 close = 19% downside. Bull $74, bear $44. Buy under $53. EV $44.07B = 10.5x trailing adjusted EBITDA of $4.20B; 14.2x the $5.38 guided 2026 adjusted EPS but 22.4x 2025's actual $3.42. - Street: Hold. 36 analysts, 12 buy / 22 hold / 2 sell, target $88 (median $90, range $79-$95). Morgan Stanley upgraded to Equal-Weight, $60 to $79, Aug 5. Barclays held Equal-Weight, $85 to $90, Aug 5. What to watch: UP: a 23.5% EPS beat that is NOT an add-back (GAAP $1.87 is above adjusted $1.84); segment operating profit +75% with all three segments up; guidance raised to $5.15-$5.60, lifting the IMPLIED second half from $1.865 to $2.815 - a $0.95 raise on a $0.35 beat; both the 2026 and 2027 RVO are finalized; net debt is only 1.65x EBITDA; the Street models $5.83 in 2027. DOWN: 61.6% of the $620M profit increase is crush plus ethanol, downstream of one EPA mandate; ~$100M is mark-to-market timing worth $0.17/share, so ex-timing the beat is 11.9%; adjusted ROIC is 7.8% at the peak; adjusted EPS was $7.84 in 2022 and $3.42 in 2025; ZERO buybacks; and 14.2x a policy peak is 22.4x last year. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.