When Monsanto Co. reports its fiscal first-quarter results Thursday, it will shed light on how the company's biotech seed business is holding up against increasing competition.
WHAT TO WATCH FOR: Signs that companies like DuPont are succeeding in stealing market share from Monsanto in the business of producing expensive, genetically altered seeds.
Monsanto, which has dominated the bioengineered-seed business for more than a decade, now faces increasing competition. Its corn and soybean seeds have genetically engineered traits that the company says benefit farmers enough that they come out ahead, despite the seeds' high cost.
Competitors are trying to boost their sales in part by slashing prices. DuPont owns Pioneer Hi-Bred, Monsanto's' biggest competitor, which has been developing its own strains of engineered crops to compete against Monsanto's. Pioneer has been aggressively courting U.S. farmers.
WHY IT MATTERS: Monsanto is betting its future on biotech seeds.
The company historically sold chemicals, from pharmaceuticals to pesticides, and most of its agricultural business used to be driven by chemicals like the herbicide Roundup. But Roundup isn't the cash cow it used to be, in part because competition from generic products from China and other nations has dragged down the price Monsanto can charge.
WHAT'S EXPECTED: Analysts polled by FactSet expect Monsanto to report earnings of 16 cents per share on $2.05 billion in revenue for the quarter ending in November.
LAST YEAR'S QUARTER: The St. Louis-based company posted net income of $6 million, or 2 cents per share, on revenue of $1.83 billion, for the period last year.