FMC Announces 'Shocking' Outlook: 4 Analysts Dive Deeper Into Prospects

Shares of FMC Corp FMC continued to decline in early trading on Tuesday, after joining the big stocks recording losses in Monday’s session.

The chemical manufacturing company's stock came under pressure after FMC announced its third-quarter and full-year outlook. Here are some key analyst takeaways from the update.

Morgan Stanley On FMC

Analyst Vincent Andrews downgraded the rating from Overweight to Equal-Weight, while lowering the price target from $100 to $70.

There is a lack of visibility into the first half of 2024, during which “destocking dynamics are set to persist,” Andrews said in the downgrade note.

“It is hard for us to envision the equity market shifting toward a more optimistic lens anytime soon, but easier for us to recognize the risk that the stock may reside in a "trough on trough" posture for some time,” the analyst added.

BMO Capital Markets On FMC

Analyst Joel Jackson reiterated an Outperform rating, while reducing the price target from $90 to $80.

FMC’s full-year EBITDA guide down to around $1 billion was “shocking,” represents a 29% year-on-year contraction in sales, and is at “a level not seen since before the diamides acquisition,” Jackson said in a note.

“With near-zero visibility into 2024 earnings power, an untrusting investor base, and FMC clearly a 2024 show-me story, this stock call is not easy,” the analyst wrote.

Check out other analyst stock ratings.

RBC Capital Markets On FMC

Analyst Arun Viswanathan maintained an Outperform rating, while cutting the price target from $105 to $80.

“FMC announced it is lowering its 3Q23/FY23 outlook due to lower volumes as destocking was greater than it expected in Brazil,” Viswanathan said. “Volumes were also impacted somewhat by drought in Argentina,” he added.

“We maintain our OP, given FMC’s low valuation and look forward to hearing more details on FMC’s cost reduction efforts and new product pipeline at FMC’s Investor Day on November 16,” the analyst further stated.

KeyBanc Capital Markets On FMC

Analyst Aleksey Yefremov reaffirmed an Overweight rating, while reducing the price target from $107 to $83.

“FMC reduced its 3Q and 4Q EBITDA view by 34% and 49%, respectively,” Yefremov said. “Weak FCF will likely weigh on shares near term until it improves,” he added.

“Another concern is whether FMC is losing share or simply dealing with the weak industry fundamentals,” the analyst stated. “We believe it is the latter, as there is no evidence for a sudden share loss,” he further mentioned.

FMC Price Action: Shares of FMC were down 4.6% to $55.40 at the time of publication Tuesday.

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