12 Best Ethanol Stocks to Buy According to Hedge Funds

3. Archer-Daniels-Midland Company (NYSE:ADM)

Number of Hedge Fund Investors: 38

Market Cap as of April 3, 2025: $23.01 billion 

Archer-Daniels-Midland Company (NYSE:ADM) is a leading processor of oilseeds, corn, wheat, and other agricultural products. The company’s vast network of logistical assets allows it to store and ship grains all over the world, making it one of the biggest grain merchandisers. The firm also operates a nutrition company that specializes in both human and animal ingredients and is a major manufacturer of ethanol, starches, and sweeteners made from corn, which makes it among the Best Ethanol Stocks

Before selling the crops to consumers of food, feed, and energy, the company buys them from farmers and then transports, stores, and/or processes them. Archer-Daniels-Midland Company (NYSE:ADM)’s profit margins are narrow since its competitors’ commodity products are easily accessible, and it has little control over the prices of the products it purchases and sells. Furthermore, the firm finds it challenging, though not impossible, to turn a profit due to the capital intensity of its operations.

Archer-Daniels-Midland Company (NYSE:ADM) reported Q4 2024 adjusted EPS of $1.14 and full-year adjusted EPS of $4.74, in line with expectations. In the fourth quarter, the total segment operating profit was $1.1 billion, and for the entire year, it was $4.2 billion. The company effectively ramped up the Spiritwood facility, strengthened North American operations, and elevated crush volumes in canola and rapeseed. Production output increased by 3% year over year due to strong plant performance, and multiple North American product lines saw record operating profits. Along with developing biosolutions and health and wellness innovations, the business further improved its safety record by cutting process safety incidents by more than 35%. A quarterly dividend increase was also announced by the company, which has now paid dividends for 93 years in a row.