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Is Monsanto Really in Trouble?

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Every once in a while it pays to listen to that little voice in your head that tells you to ignore all of the noise suggesting why a company may or may not reach optimal performance. Lately, I have found that Monsanto (MON) fits this exact description.

 

While this company should be well-liked for what is a different environmental approach, there is often an outcry by bears suggesting that it can't survive against DuPont (DD) and Syngenta (SYT). Granted, Monsanto is no longer the pristine stock that the Street once believed it was, but there's quite a bit of an overreaction to the company's recent performance.

 

I'm not suggesting that DuPont and Syngenta aren't real threats. However, though, when considering Monsanto's product pipeline and the launch of several new products like Genuity and Intacta, it would seem that Monsanto has a meaningful edge. The question, though, is how well can management execute in the long term?

 

Finally, investors have to realize that this is a strong business with incredible momentum. What's more, I don't believe Monsanto's potential is fully reflected in today's share price. That said, this is not the type of stock one should enter without fully appreciating the market dynamics. Nevertheless, for investors with plenty of patience, Monsanto has proven that it will reward the long-term investor.

 

Disclosure: At the time of publication, Richard held no positions in any of the companies mentioned.

 

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