Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 5 stocks made the list for top value stocks in the Food Products industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Food Products Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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5 Undervalued Food Products Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 5 undervalued stocks in the Food Products industry for Wednesday, October 30, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Food Products industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Archer-Daniels-Midland Company’s Value Grade

Value Grade:

Archer-Daniels-Midland Company engages in the procurement, transportation, storage, processing, and merchandising of agricultural commodities, ingredients, flavors, and solutions in the United States, Switzerland, the Cayman Islands, Brazil, Mexico, Canada, the United Kingdom, and internationally. It operates in three segments: Ag Services and Oilseeds, Carbohydrate Solutions, and Nutrition. The company originates, merchandises, stores, and transports agricultural raw materials, such as oilseeds and soft seeds. It also engages in the agricultural commodity and feed product import, export, and distribution; and various structured trade finance activities. In addition, the company offers soybean meal and oil; vegetable and salad oils and protein meals; ingredients for the food, feed, energy, and industrial customers; margarine, shortening, and other food products; and partially refined oils to produce biodiesel and glycols for use in chemicals, paints, and other industrial products. Further, it provides peanuts, peanut-derived ingredients, and cotton cellulose pulp; sweeteners, corn and wheat starches, syrup, glucose, wheat flour, and dextrose; alcohol, and other food and animal feed ingredients; ethyl alcohol and ethanol; corn gluten feed and meal; distillers’ grains; corn germ; and citric acids. Additionally, the company provides proteins, natural flavors, flavor systems, natural colors, emulsifiers, soluble fiber, polyols, hydrocolloids, probiotics, prebiotics, postbiotics, enzymes, and botanical extracts; and other specialty food and feed ingredients; edible beans; formula feeds, and animal health and nutrition products; and contract and private label pet treats and food products. It also offers futures commission merchant; commodity brokerage services; cash margins and securities pledged to commodity exchange clearinghouse; and cash pledged as security under certain insurance arrangements. The company was founded in 1902 and is headquartered in Chicago, Illinois.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Archer-Daniels-Midland Company has a Value Score of 92, which is considered to be undervalued.

When you look at Archer-Daniels-Midland Company’s price-to-sales ratio at 0.33 compared to the industry median at 0.93, this company has a lower price relative to revenue compared to its peers. This could make Archer-Daniels-Midland Company’s stock more attractive for value investors.

Archer-Daniels-Midland Company’s price-earnings ratio is 11.20 compared to the industry median at 20.20. This means it has a lower share price relative to earnings compared to its peers. This could make Archer-Daniels-Midland Company more attractive for value investors.

Now, let’s assess Archer-Daniels-Midland Company’s EV/EBITDA ratio, also known as enterprise multiple. At 9.4, when compared to the industry median of 12.6, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Archer-Daniels-Midland Company’s shareholder yield is higher than its industry median ratio of 0.00%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Archer-Daniels-Midland Company’s price-to-book ratio is lower than its industry median ratio of 1.63. This could make Archer-Daniels-Midland Company more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Archer-Daniels-Midland Company’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Archer-Daniels-Midland Company’s price-to-free-cash-flow ratio is lower than its industry median ratio of 18.10. This could make Archer-Daniels-Midland Company more attractive because the lower P/FCF ratio indicates that Archer-Daniels-Midland Company is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Benson Hill, Inc.’s Value Grade

Value Grade:

Benson Hill, Inc., together with its subsidiaries, operates as a food technology company that unlocks natural genetic diversity of plants. It operates in two segments, Ingredients and Fresh. The company offers CropOS, a technology platform, which uses artificial intelligence, data, and various advanced breeding techniques that combine data, plant, and food sciences to deliver crops optimized for food, ingredient, and feed products. The company’s technology is applied in soybeans and yellow peas. It focuses on growing, packing, and selling fresh produce products to retail and food service customers. The company was formerly known as Benson Hill Biosystems, Inc. Benson Hill, Inc. was incorporated in 2012 and is headquartered in Saint Louis, Missouri.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Benson Hill, Inc. has a Value Score of 87, which is considered to be undervalued.

Benson Hill, Inc.’s price-to-book ratio is higher than its peers. This could make Benson Hill, Inc. less attractive for value investors when compared to the industry median at 1.63.

You can read more about Benson Hill, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Farmmi, Inc.’s Value Grade

Value Grade:

Farmmi, Inc., through its subsidiaries, engages in processing and sale of agricultural products in China, the United States, Japan, Canada, Europe, Korea, and the Middle East. The company offers Shiitake mushrooms, Mu Er mushrooms, and other edible fungi, such as bamboo fungi, agrocybe aegerila, pleurotus eryngii, grifola frondose, coprinus comatus, and hericium erinaceus, as well as dried edible fungi. It is also involved in trading of cotton, corn, and other agricultural products. The company’s products are offered under Lishui Shangeng, Farmmi Liangpin, Forasen, and Puyangtang brands. It offers its products through local distributors to processing manufacturers, supermarkets, restaurants, cafeterias, and local specialty stores. The company was founded in 1994 and is headquartered in Lishui, China.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Farmmi, Inc. has a Value Score of 91, which is considered to be undervalued.

Farmmi, Inc.’s price-earnings ratio is 2.8 compared to the industry median at 20.2. This means that it has a lower price relative to its earnings compared to its peers. This makes Farmmi, Inc. more attractive for value investors.

Farmmi, Inc.’s price-to-book ratio is higher than its peers. This could make Farmmi, Inc. less attractive for value investors when compared to the industry median at 1.63.

You can read more about Farmmi, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Planet Green Holdings Corp.’s Value Grade

Value Grade:

Planet Green Holdings Corp., through its subsidiaries, engages in the production and distribution of brick, black, and green tea products in China and internationally. It also imports and distributes beef and mutton products; manufactures and sells ethanol fuel and fuel additives, including alcohol based clean fuel, liquid wax, arene, and biomass fuel; and produces formaldehyde, urea formaldehyde adhesive, and methylal products, as well as vehicles gasoline and diesel products. In addition, the company manufactures and sells insulation type explosion-proof skid-mounted refueling equipment and SF double-layer buried oil storage tank products. Further, it operates a demand-side platform that allows buyers of digital advertising inventory to manage multiple advertisement exchange and data exchange; and develops and operates various games. The company was formerly known as American Lorain Corporation and changed its name to Planet Green Holdings Corp. in September 2018. Planet Green Holdings Corp. was founded in 1986 and is headquartered in Flushing, New York.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Planet Green Holdings Corp. has a Value Score of 68, which is considered to be undervalued.

Planet Green Holdings Corp.’s price-to-book ratio is higher than its peers. This could make Planet Green Holdings Corp. less attractive for value investors when compared to the industry median at 1.63.

You can read more about Planet Green Holdings Corp.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Seaboard Corporation’s Value Grade

Value Grade:

Seaboard Corporation, together with its subsidiaries, operates as an agricultural and ocean transportation company worldwide. It operates through six segments: Pork, Commodity Trading and Milling (CT&M;), Marine, Sugar and Alcohol, Power, and Turkey. The Pork segment produces and sells pork products to further processors, food service operators, grocery stores, and distributors; hogs; and biodiesel. The CT&M; segment sources, transports, and markets wheat, corn, soybeans, soybean meal, and other commodities; and produces and sells wheat flour, maize meal, manufactured feed, and oilseed crush commodities. The Marine segment provides cargo shipping services; owns and leases dry, refrigerated, specialized containers, and other related equipment; and operates a terminal and an off-port warehouse for cargo consolidation and temporary storage. The Sugar and Alcohol segment produces and sells sugar and alcohol. The Power segment operates as an independent power producer that generates electricity for the power grid in the Dominican Republic. The Turkey segment produces and processes conventional and antibiotic-free turkey products to retail stores, food service outlets, and industrial entities, as well as exports products to Mexico and internationally. The company also processes and sells jalapeño peppers. Seaboard Corporation was founded in 1918 and is headquartered in Merriam, Kansas.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Seaboard Corporation has a Value Score of 95, which is considered to be undervalued.

Seaboard Corporation’s price-earnings ratio is 11.0 compared to the industry median at 20.2. This means that it has a lower price relative to its earnings compared to its peers. This makes Seaboard Corporation more attractive for value investors.

Seaboard Corporation’s price-to-book ratio is higher than its peers. This could make Seaboard Corporation less attractive for value investors when compared to the industry median at 1.63.

You can read more about Seaboard Corporation’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Food Products Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Food Products stocks as well as other industrys.

Choosing Which of the 5 Best Food Products Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Archer-Daniels-Midland Company stock has a Value Grade of A.
• Benson Hill, Inc. stock has a Value Grade of A.
• Farmmi, Inc. stock has a Value Grade of A.
• Planet Green Holdings Corp. stock has a Value Grade of B.
• Seaboard Corporation stock has a Value Grade of A.

Now that you have a bit more background about each of the 5 undervalued stocks in the Food Products industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Food Products Stocks

Want to learn more about Food Products stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 5 Undervalued Food Products Stocks for Wednesday, October 30
• 6 Undervalued Food Products Stocks for Tuesday, October 29
• 4 Undervalued Food Products Stocks for Monday, October 28
• 6 Undervalued Food Products Stocks for Friday, October 25

AAII Disclaimer

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