Jefferies Initiates ADM With A Hold Rating, $34 PT

Jefferies is initiating coverage on Archer-Daniels-Midland ADM with a Hold rating and a $34 price target. “ADM's share price has historically moved in close tandem (positive 0.79 correlation) with ethanol operating profit per gallon, which we expect to remain near its current level of $0.30 to $0.40 per gallon in coming quarters,” Jefferies writes. “We expect the price of ethanol to remain near $2 per gallon over the next several quarters driven by elevated corn and oil prices, a stable supply/demand balance and increased export potential with Brazilian ethanol currently priced above U.S. ethanol.” Archer-Daniels-Midland closed Wednesday at $30.22.