Monsanto Company (MON) is a provider of agricultural products for farmers with solutions that improve productivity, reduce the costs of farming, and produce better foods for consumers and better feed for animals. The stock is currently trading around $113.92 around the middle end of its 52 week range of $105.76-$128.79. The stock has been underperforming the market this year falling by 4.55% year to date. MON is scheduled to report earnings before the opening bell tomorrow, and the stock is weak today falling by $0.43 or 0.38% on the session ahead of the close.

Over the past 12 quarters MON has rallied on earnings day 7 times with an average move of 2.22%. The stock appears bearish on a chart going into the release having traded below the Ichimoku Cloud for the past month on the daily bars. Over the past 12 quarters MON has rallied from earnings to the nearest options expiration 8 times with an average move of 3.07%. The stock looks as if it could continue its trend and lower further in today’s session. Investors are mainly looking to see if the company was able to lower its operating expenses by at least 3-5% as promised. Investors expect the company to earn $275 million in gross profit due to high demand as farmers always seek to maximize their crop yields.

The options market is currently implying a move of around $3.72 or 3.3% in MON by this Friday’s close giving us targets of $110.20 and $117.64.

Andrew Keene

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