Archer-Daniels-Midland (NYSE:ADM) stock is in focus today after the firm reported that it slightly altered its financial results between 2018 and 2023.
The agricultural products company noted that a number of its employees have now been subpoenaed by the U.S. Department of Justice (DOJ), which is investigating the firm. The DOJ probe into Archer-Daniels-Midland’s accounting standards is also reportedly progressing at a rapid pace.
ADM Stock and Financial Irregularities
So, what exactly was irregular about the company’s financial results?
According to reports, the prices that Archer-Daniels-Midland’s divisions charged each other for some products did not reflect “market value,” per Reuters. As a result, the firm has corrected “certain segment-specific financial information” for the years between 2018 and 2023.
On a positive note, ADM did report that these corrections would not significantly affect its overall data. Indeed, ADM says the alterations will not impact its “consolidated balance sheets and statements of earnings, comprehensive income (loss), or cash flows.”
Looking forward, Archer-Daniels-Midland is changing its financial reporting standards to make its results more accurate. The company has suspended its Chief Financial Officer on “immediate administrative leave” as well.
Still, a number of ADM’s current and former employees have been served with “grand jury subpoenas” by the DOJ and the company is cooperating with the Department of Justice. Meanwhile, according to Reuters, the subpoenas suggest that the investigation of the firm’s financial results is accelerating quickly.
Fourth-Quarter Results and Buyback News
This morning, Archer-Daniels-Midland noted that its fourth-quarter sales tumbled 11% versus the same period a year earlier. Meanwhile, its adjusted EPS sank 30% year-over-year (YOY). ADM also noted that its margins dropped.
However, the company did report that its board has authorized an additional $2 billion of share buybacks. This falls under the firm’s “existing 200 million share repurchase program that runs through 2024.”
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.