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3 Reasons to Add FMC Corp. (FMC) Stock to Your Portfolio

Zacks Equity Research
Updated

FMC Corporation’s FMC stock looks promising at the moment. The company has a market capitalization of $11.9 billion is a leading diversified chemical company that serves agricultural, industrial, environmental and consumer markets across the globe.

FMC Corp., a Zacks Rank #1 (Strong Buy) stock, has seen its shares shoot up roughly 57% year to date. If you haven’t taken advantage of the share price appreciation yet, the time is right for you to add the stock to portfolio as it looks promising and is poised to carry the momentum ahead.

What Makes FMC an Attractive Pick?

An Outperformer: FMC Corp. has significantly outperformed the industry it belongs to over a year. Its shares rallied 88.1% over this period compared with the industry’s gain of 29.4% over the same period. FMC Corp. is benefiting from its strategic investments, acquisitions and efforts to expand its market position and strengthen its portfolio. Upbeat prospects for the company’s Lithium unit have also provided a boost to its shares.



 

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Acquisitions to Drive Growth: Acquisitions are adding strength to the company’s agricultural business. The acquisition of Cheminova has reinforced FMC Corp.'s agriculture business and expanded its access in major agricultural end markets. The company is making a good progress with the integration of the acquired operations of Cheminova. FMC Corp. will benefit from the cost synergies of the Cheminova buyout.

Moreover, the planned acquisition of a major portion of DuPont's Crop Protection business has also provided a significant growth platform for FMC’s Agricultural Solutions unit. After deal closure, FMC Corp.’s Agricultural Solutions unit will become the fifth biggest crop protection chemical company in the world by sales with estimated annual revenues of around $3.8 billion. The acquisition will significantly increase the company’s presence in Asia and Europe and will be immediately accretive to its adjusted earnings per share.

Lithium Unit Showing Strength: FMC Corp. is also witnessing strong momentum in its Lithium unit. The company is expanding its lithium hydroxide production capacity. It is executing this expansion in three phases. The move is based on the growing demand for electric vehicles. The company expects its lithium business to deliver strong earnings growth in 2017.

FMC Corp., in August, raised its outlook for the Lithium unit for 2017. The company now sees revenues in the range of $340-$360 million (up from $325-$365 million expected earlier) for the unit. Segment earnings are forecast to be in the band of $115 to $125 million (up from $100 to $120 million expected earlier) for the year.

FMC Corporation Price and Consensus

 

FMC Corporation Price and Consensus | FMC Corporation Quote

Other Stocks to Consider

Other stocks in the basic materials space worth considering include Kraton Corporation KRA, The Chemours Company CC and Orion Engineered Carbons, S.A. OEC, all sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Kraton has expected earnings growth of 7.2% for the current year.

Chemours has expected long-term earnings growth of 15.5%.

Orion Engineered Carbons has expected earnings growth of 19% for the current year.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>


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FMC Corporation (FMC) : Free Stock Analysis Report
 
Chemours Company (The) (CC) : Free Stock Analysis Report
 
Orion Engineered Carbons S.A (OEC) : Free Stock Analysis Report
 
Kraton Corporation (KRA) : Free Stock Analysis Report
 
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