Monsanto said Friday it is increasing its earnings outlook for fiscal 2007, due to strong results from the corn planting season in the U.S. and from the company's herbicide business.
The news sent shares of Monsanto up about $3.63, or about 6%, to $66.94 in early trading on the New York Stock Exchange.
The company said it expects fiscal 2007 ongoing earnings of $1.75 to $1.80 a share, compared with a prior outlook of $1.60 to $1.65 a share.
Monsanto also said that third-quarter results were expected to be about $1.00 a share on an ongoing and reported basis.
Analysts, on average, were looking for earning of 76 cents a share in third quarter, and $1.69 a share for fiscal 2007, according to Thomson Financial.
The forecasts exclude the impact of the pending sale of Stoneville and NexGen, the company said.
"We're having extraordinary performance in an extraordinary year for agriculture," said Chairman, President and Chief Executive Hugh Grant.
Bank of American analyst Kevin McCarthy told the Associated Press that Monsanto's announcement is causing him to reevaluate his "neutral" rating on the company's stock.
McCarthy has long remained neutral on the stock, citing the threat to Monsanto from increasing competition from DuPont's Pioneer Hi-Bred International. Pioneer is developing its own strains of genetically engineered seeds to compete with Monsanto's. The companies are battling over market share in the U.S. corn seed market.
Many farmers place seed orders during spring months, and Monsanto said it is encouraged by an early review of its performance.
Monsanto is scheduled to announce its full earnings for the third quarter on June 28, which could include a more detailed breakdown of corn seed sales.