Archer Daniels Midland (ADM): This Company is a Smart Dividend Buy

Archer Daniels Midland Dividend data by YCharts.

Yet as you can see, none of these challenges has hurt ADM’s ability to pay sizable dividends. In fact, the company just raised its payout in February, with a 9% jump in its quarterly dividend.

ADM has sought to grow by reaching out to industry peers. It allowed Solazyme Inc (NASDAQ:SZYM) to use an Iowa plant to produce its renewable algal oils, which helped Solazyme boost its overall production to achieve commercial-scale levels. Meanwhile, ADM’s ongoing attempt to buy the remaining 80% of Australia’s GrainCorp that it doesn’t already own has met with resistance, as the Australian exporter has so far rebuffed a sweetened bid for the company. Whether those moves will pay off for ADM in the long run remains to be seen.

When will dividends rise again?
With ADM just having boosted its payout, investors shouldn’t expect another dividend increase until 2014. But with the company having been able to produce a nice increase even in tough times, the potential for even larger gains under better conditions should help ADM’s future prospects.

The article Archer Daniels Midland Is a Smart Dividend Buy originally appeared on Fool.com.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter: @DanCaplinger. The Motley Fool owns shares of Solazyme.

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