Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Monsanto Company (MON), Syngenta AG (ADR) (SYT): How This Company Profits From Fighting World Hunger

Page 1 of 2

Shares of Monsanto Company (NYSE:MON) have underperformed in the past three months, after the company announced it will drop all of its European Union requests for the approval of new genetically modified crops. Meanwhile, the government keeps investigating Monsanto Company (NYSE:MON)’s business, looking for antitrust violations. But considering Monsanto Company (NYSE:MON) is the global leader in the increasingly important agricultural biotechnology industry (more than 170 million hectares of land are already planted with genetically modified crops), is this a buying opportunity?

MON Chart

Source: YCharts

A great story behind the stock
For the past 10 years, Monsanto Company (NYSE:MON) managed to grow its revenue base moderately. This could change if Monsanto Company (NYSE:MON) manages to get its GM crops approved by most world legislatures. Considering how controversial GM crops remain in the minds of most citizens and politicians, is this possible? Well, maybe not in the short run, but the long run shows several hopeful trends for the company.

Monsanto Company (NYSE:MON)

According to a recent study, if the world is to grow enough food for the projected global population in 2050 — 9.6 billion people — agricultural productivity would need to rise by at least 60%. Currently, productivity of corn, rice, wheat, and soybean crops is increasing 0.9% to 1.6% every year.

This is just too low to meet the requirements for 2050. At this rate, these crops would increase 38% to 67% by 2050, rather than the required 60% to 110%.

Source: Monsanto Investor Relations, presentation slides.

Furthermore, in some countries (such as in Eastern Europe), crop yields are actually decreasing. At the same time, the cost of food keeps rising globally. And looking at the global market for corn, Monsanto Company (NYSE:MON) argues that demand growth has by far outpaced supply.

Who can solve this problem?
Monsanto’s yield-improving technologies and GM seeds may be the answer. It owns a massive germplasm bank across six continents, and would be more than happy to sell GM seeds to most farmers in the world, if that becomes legally possible. It already has a strong presence in the Americas, with more than 150 million hybrid planted acres so far. According to Morningstar, roughly 90% of the soybeans and 80% of the corn grown in the U.S. contain a Monsanto trait .

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!