FMC (NYSE:FMC) Shares Gap Down on Analyst Downgrade

Key Points

• FMC shares plunged after RBC cut its price target from $11 to $9, with the stock opening at $5.12 versus a prior close of $8.09. RBC maintained a sector perform rating.
• The company sharply reduced its third-quarter outlook, now forecasting revenue of $65 million–$125 million and adjusted EBITDA of negative $565 million–$510 million, including $625 million–$675 million in commercial-action charges.
• FMC is cutting prices and revising its U.S. sales model to clear elevated customer inventories, measures that may improve product movement but pressure near-term revenue and margins. Analysts collectively rate the stock “Hold,” with an average price target of $13.38.

Shares of FMC Corporation (NYSE:FMC - Get Free Report) gapped down before the market opened on Thursday after Royal Bank Of Canada lowered their price target on the stock from $11.00 to $9.00. The stock had previously closed at $8.09, but opened at $5.12. Royal Bank Of Canada currently has a sector perform rating on the stock. FMC shares last traded at $5.1580, with a volume of 7,047,936 shares trading hands.

FMC has been the topic of several other research reports. Barclays raised shares of FMC from a "strong sell" rating to a "hold" rating in a report on Thursday, August 6th. Wall Street Zen upgraded shares of FMC from a "sell" rating to a "hold" rating in a report on Saturday, August 1st. UBS Group reduced their price target on shares of FMC from $12.00 to $10.00 and set a "neutral" rating on the stock in a report on Monday, October 5th. BMO Capital Markets set a $14.00 price target on shares of FMC in a research note on Friday, July 3rd. Finally, Weiss Ratings reissued a "sell (d-)" rating on shares of FMC in a report on Wednesday, August 26th. Four equities research analysts have rated the stock with a Buy rating, six have issued a Hold rating and four have assigned a Sell rating to the company's stock. According to MarketBeat, the company has an average rating of "Hold" and an average price target of $13.38.

Key Stories Impacting FMC

Here are the key news stories impacting FMC this week:

• Positive Sentiment: FMC announced commercial actions in Brazil, Argentina, the United States and Canada intended to accelerate the movement of products through distribution channels and support future replenishment demand. The company also said it expects to comply with its debt covenants as of September 30 and will discuss potential covenant modifications with its banks. FMC Corporation Provides Update to Third-Quarter Expectations
• Neutral Sentiment: The company plans to lower prices on selected products held by channel customers and revise its U.S. selling and pricing model to narrow the gap between gross and net pricing. These steps could improve inventory movement but are likely to pressure near-term margins and revenue. FMC Guides Below Expectations on Weak Demand and Price Cuts
• Negative Sentiment: FMC now expects third-quarter revenue of only $65 million to $125 million and adjusted EBITDA of negative $565 million to $510 million. The revised outlook includes approximately $625 million to $675 million of charges tied to commercial actions. An earlier reported revenue range of $690 million to $800 million was also below the roughly $865 million consensus estimate, underscoring the severity of the subsequent revision. FMC Third-Quarter Update
• Negative Sentiment: High inventories of more expensive products at certain channel customers are slowing product movement and reducing near-term demand. The company has not finalized its quarterly results and said it cannot yet estimate complete GAAP results, increasing uncertainty ahead of its scheduled October 29 earnings release. FMC Shares Plunge as Company Cuts Outlook

Hedge Funds Weigh In On FMC

Hedge funds have recently added to or reduced their stakes in the company. IFP Advisors Inc lifted its stake in shares of FMC by 99.0% during the 2nd quarter. IFP Advisors Inc now owns 2,726 shares of the basic materials company's stock worth $31,000 after acquiring an additional 1,356 shares during the last quarter. Glenmede Trust Co. NA grew its holdings in shares of FMC by 14.9% in the first quarter. Glenmede Trust Co. NA now owns 12,427 shares of the basic materials company's stock worth $214,000 after purchasing an additional 1,614 shares during the last quarter. Root Financial Partners LLC grew its holdings in shares of FMC by 3,642.9% in the first quarter. Root Financial Partners LLC now owns 1,834 shares of the basic materials company's stock worth $32,000 after purchasing an additional 1,785 shares during the last quarter. GAMMA Investing LLC boosted its position in FMC by 47.7% in the 3rd quarter. GAMMA Investing LLC now owns 6,620 shares of the basic materials company's stock valued at $59,000 after buying an additional 2,139 shares during the period. Finally, Essential Partners LLC purchased a new stake in FMC in the 1st quarter valued at about $43,000. 91.86% of the stock is currently owned by institutional investors.

FMC Price Performance

The company has a debt-to-equity ratio of 2.38, a quick ratio of 1.48 and a current ratio of 1.99. The firm has a market capitalization of $688.12 million, a P/E ratio of -0.25 and a beta of 0.45. The stock's 50 day simple moving average is $10.44 and its 200 day simple moving average is $12.24.

FMC (NYSE:FMC - Get Free Report) last posted its quarterly earnings results on Wednesday, July 29th. The basic materials company reported $0.26 earnings per share for the quarter, beating the consensus estimate of $0.22 by $0.04. The firm had revenue of $841.40 million during the quarter, compared to the consensus estimate of $895.14 million. FMC had a negative net margin of 84.83% and a positive return on equity of 11.35%. The company's revenue was down 17.5% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.69 earnings per share. As a group, analysts expect that FMC Corporation will post 1.23 earnings per share for the current fiscal year.

FMC Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Thursday, October 15th. Shareholders of record on Wednesday, September 30th will be given a dividend of $0.08 per share. The ex-dividend date of this dividend is Wednesday, September 30th. This represents a $0.32 dividend on an annualized basis and a yield of 5.8%. FMC's payout ratio is -1.45%.

FMC Company Profile

FMC Corporation NYSE: FMC is an agricultural sciences company that develops, manufactures and markets crop protection products for farmers and other agricultural professionals. Its portfolio includes herbicides, insecticides and fungicides used to help protect crops from weeds, insects and diseases.

The company also develops biological and other crop health solutions, supported by research in areas such as plant science, chemistry and biotechnology. FMC's products are used across a range of crops and growing conditions, and the company serves agricultural markets in North America, Latin America, Europe, Asia and other regions worldwide.

FMC traces its origins to 1883 and has evolved through acquisitions and investments in agricultural technology into a focused crop protection company.

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