Seeking Alpha: American Vanguard Starting A Long Road Back

Back in my Wall Street days, American Vanguard (NYSE:AVD) would have been called "a stock split the hard way", as the shares have dropped almost 50% over the last year on persistently weak sell-through of soil insecticides and herbicides for corn. Weather has had an impact, as have acreage switches to other crops and less insect pressure, but the fundamental issue is that management significantly overestimated the on-the-ground demand for its products and is now stuck working through inflated inventories and inefficient overhead utilization. I don't think the positives that moved the stock in 2013 have all vanished, but management has a lot to prove before these shares can move back into the $20's.

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American Vanguard Starting A Long Road Back

Seeking Alpha: Albemarle Pays A Stiff Price For A Premium Asset

I wrote about Rockwood Holdings (NYSE:ROC) in December of 2013 and thought at the time that it was a very high-quality specialty chemical company, with an attractive cost-advantaged lithium business, but an expensive stock. That opinion worked reasonably well until today, as other chemical companies like BASF (OTCQX:BASFY) and Taminco (NYSE:TAM) had been outperforming the shares. That's all moot now, though, as Albemarle (NYSE:ALB) has stepped up with a premium buyout offer for this specialty chemical company.

For Albemarle's part, they're paying up to add a well-run surface treatments business and grab the growth potential of Rockwood's top-notch lithium operations. Paying 14x 2014 pro-forma EBITDA (and more than 11x assuming synergies) is steep, but Rockwood is a unique asset with both strong internal returns and good growth potential leveraged to the developing electric vehicle market.

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Albemarle Pays A Stiff Price For A Premium Asset

Seeking Alpha: OCI Resources LP Not Really Cheap, But An Interesting MLP Nonetheless

MLPs have long offered a way for investors to generate tax-shielded income from underlying assets in various stages of the oil and gas industry - whether upstream E&P, midstream, or distribution. OCI Resources LP (OCIR) is a different sort of animal, though, as it is among a group of relatively rare MLPs based around mining and refining/processing assets - trona ore mining and soda ash production, to be specific. With its cost-advantaged position and long-lived asset base, OCI Resources LP should be able to generate years and years of distributable cash flow. The one hitch is that these units are not all that undervalued today, though a yield of over 8% is still appealing.

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OCI Resources LP Not Really Cheap, But An Interesting MLP Nonetheless

Seeking Alpha: FMC Corp's Exceptional Performance Comes At A Cost

There are a lot of really good things about FMC Corporation (FMC). The company's unusual model in agricultural chemicals allows for exceptional margins, and the company's food/nutrition business is a leader in close to two-thirds of its operations. The only fly in the ointment is that investors are well aware of FMC's exceptional growth and its different model, and the valuation on these shares is not low.

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FMC Corp's Exceptional Performance Comes At A Cost

Seeking Alpha: American Vanguard Should Reap A Better Multiple

American Vanguard (AVD) has long been a volatile small-cap stock. Some of that can be chalked up to the vagaries of the agricultural chemicals market, a business where the likes of FMC Corp. (FMC) have also had ample ups and downs. Some of it, too, can be attributed to the fact that investors in agricultural stocks often seem to look and think no further than the next harvest, so planting, weather, and harvest data can make these stocks move in the opposite direction of fundamentals.

To that end, I think it's worth checking out American Vanguard today. Although I do have some long-term concerns about the company's position vis a vis new GM crops that target lucrative parts of the company's business, I believe there's a very good chance that the stock will deliver stronger results in the short term as capacity upgrades and strong marketing support from partner Monsanto (MON) lead to much better herbicide and pesticide sales.

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American Vanguard Should Reap A Better Multiple

Seeking Alpha: Monsanto - Execution Needs To Merge With Opportunity

A good story will only take a company so far, and the last few years have brought that lesson home to Monsanto (NYSE: MON) the hard way. After years of aggressive pricing on their seed traits and tactics towards farmers that skirted (if not crossed) the line of bullying, Monsanto found to its dismay that rivals like DuPont (NYSE: DD) and Syngenta (NYSE: SYT) had closed the performance gap and customers were more than happy to give them a try. While Monsanto has what looks to be the most exciting pipeline in agribiotech and ample growth opportunities; management must be careful not to repeat the errors of the past if investors are to reap all the rewards they should.

Monsanto Fixing Itself Faster Than Some Expected
After years of riding high on the success off its genetically-engineered seed traits, Monsanto has had a rough couple of years recently. The company basically overpriced its seeds relative to their yield production (particularly SmartStax and Roundup Ready 2) and farmers began switching over to alternatives from DuPont and Syngenta. This transition was aided in no small part by a bad reputation that Monsanto had built with its customers after years of arrogance and aggressive tactics designed ostensibly at protecting its franchise. 

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Monsanto: Execution Needs To Merge With Opportunity

Investopedia: FMC A Three-For-One Chemical Company

In the past couple of years, investors have paid a great deal of attention to the agricultural, industrial and battery markets. FMC Corp (NYSE:FMC) is a relatively rare chemicals company in that addresses all three markets. While FMC has enjoyed a great run already, investors may yet be able to wring even more leverage out of a company that seems to be executing as well as any in its markets. 

Solid Second Quarter Performance
FMC met guidance with a little less than 5% revenue growth in the second quarter. Sales growth was led by the agricultural business (which grew 12%), while the specialty business grew 6%. Reported growth in the industrial category was down 5%, but adjusting for asset/business dispositions underlying growth was more on the order of 7% to the positive.

FMC has seen more than a year of ongoing margin expansion and this quarter was no different. Gross margin grew more than two and a half full points from the year-ago level, and operating income jumped more than 18% for the quarter.


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