Monsanto Co. (NYSE: MON) pleasantly surprised the Street with a stronger-than-expected third-quarter profit. This morning, the company reported quarterly net income of $694 million, or $1.25 per share, besting analysts' expectations for a profit of $1.18 per share. Net sales arrived at $3.2 billion, down 11% from the year-ago period.

Additionally, Monsanto said it will create a separate division for its herbicides business, in order to "better align spending and working capital needs." The firm will also undergo a restructuring that will result in 900 lost jobs, or less than 4% of its global workforce. The change will translate to a fourth-quarter charge of roughly $350 million, or 41 cents to 47 cents per share.

Shares of Monsanto Company (NYSE: MON) moved up strongly in premarket trading this morning, and opened over 8% higher as buyers move into the stock following strong first quarter numbers and raised full year guidance.

Going into this morning's earnings announcement, analysts had been expecting to the see Monsanto, which supplies agricultural products for farmers in the United States and internationally, to show first quarter earnings of $0.59 per share, but the company blew out analyst estimates by reporting $0.98 per share for its first quarter.

Looking at company revenue for the quarter, Monsanto also shattered analyst estimates by raking in $2.65 in the quarter as opposed to estimates of $2.41 billion, an increase of 29% for the company.

The company also raised fully year guidance and the stock is benefiting from that too. Previously, Monsanto had issued full year 2009 guidance of $4.20 to $4.40, but lifted that estimate today to a range between $4.40 and $4.50.

Shares of the stock have opened over 8% higher, and by 9:45 am jumped over 15%, adding $11.10 to $84.32. It closed yesterday at $73.46.

Michael Fowlkes has worked as a stock trader for seven years and spent the last four years working as an analyst for the online investment advisory service Investor's Observer.

This post is part of a series featuring bargain stocks that are worth a look now. See more Cheap Stocks.

Every time I write about Monsanto Company (NYSE: MON), I get e-mails from vocal opponents of genetically modified foods. It strikes me as unusual, if only because there are so many companies out there doing business in an ethically questionable manner, and I'm rarely e-mailed about most of them. But, hey -- I can't blame anybody for being protective of the food supply.

If you're morally opposed to Monsanto, I definitely don't recommend you invest in it. Otherwise, there are valid reasons for taking a closer look at this agricultural chemicals firm. For example, on October 21, S&P Ratings hiked its long-term ratings on MON from "A" to "A+," citing the "expected continuation for favorable business trends ... a very strong market position ... and an impressive pipeline of new products that should underpin strong future earnings and cash flow."

Add sugar cane to the pipeline; Monsanto recently announced its intention to acquire Brazil's Aly Participacoes Ltda for $290 million. With sugar cane emerging as a popular alternative to corn for ethanol production, the acquisition makes sense. Carl Casale, the company's head of global strategy and operations, observed, "... we think that the biotechnology traits that we've invested in [corn] can bring a lot of value to sugar, as well."

Monsanto Company (NYSE: MON) provides agricultural products to farmers worldwide. The company produces seeds and develops biotechnology traits that assist farmers in controlling insects and weeds. Products include canola, corn, soybean, fruit, cotton, sunflower and sorghum seed. Monsanto also manufactures the world's leading herbicide, Roundup. Further, it provides products that focus on improving dairy cow productivity and it sells genetics lines for improving the productivity and meat quality of swine.

The company pleased investors earlier in the week, when it issued upside earnings guidance. Management predicted Q2 EPS "in the range of $1.75", versus Street consensus of $1.35. It also said it was looking for FY08 EPS in the range $3.15-$3.25, versus consensus of $2.87. The brighter views were attributed to leading corn market share positions, accelerated biotechnology trait penetration and new value generated by Roundup and other glyphosate-based herbicides.

When you are a big producer of crop seeds, manufacturing herbicides does not seem to be the most sympathetic business diversification. Still, there is an outfit in St. Louis that makes it work. It simply alters its seeds genetically, so they tolerate its herbicides.

Monsanto Company (NYSE: MON) provides agricultural products to farmers worldwide. The company produces seeds and develops biotechnology traits that assist farmers in controlling insects and weeds. Products include canola, corn, soybean, fruit, cotton, sunflower and sorghum seed. Monsanto also manufactures the world's leading herbicide, Roundup. Further, it provides products that focus on improving dairy cow productivity and it sells genetics lines for improving the productivity and meat quality of swine.

The company pleased investors last week, when it reported fiscal Q1 EPS of 46 cents and revenues of $2.1 billion. Analysts had been expecting 35 cents and $1.87 billion. Robust Latin American demand for Roundup and seed trait products was cited as a big factor in the successful quarter. Management also guided FY08 EPS to $2.50-2.60 ($2.59 consensus) and boosted its FY08 free cash flow estimate from $800-900 million to $0.9-1.0 billion.

Monsanto Company (NYSE: MON) provides agricultural products to farmers worldwide. The company produces seeds and develops biotechnology traits that assist farmers in controlling insects and weeds. Products include canola, corn, soybean, fruit, cotton, sunflower and sorghum seed. Monsanto also manufactures the world's leading herbicide, Roundup. Further, it provides products that focus on improving dairy cow productivity and it sells genetics lines for improving the productivity and meat quality of swine.

Early last week, the firm issued upside guidance for FY07. Management boosted its EPS estimate from $1.75-$1.80 to $2.00. That topped the consensus Street estimate of $1.83. The news popped the shares out of an early September "cup" into the mid-September "handle" of a Cup & Handle formation. The price is now completing the pattern with a bullish rise from the right-hand side of the "handle," on word the company believes the opportunity for its biotech traits outside the United States could nearly triple the 95 million acres penetrated today.

Brokers recommend the shares with four "strong buys," four "buys," five "holds" and one "sell." Analysts see a 28% average annual growth rate, through the next five years. The MON Sales Growth rate (23.08%), EPS Growth rate (67.21%), Operating Margin (18.53%) and Net Profit Margin (12.92%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 86 percent of the outstanding shares. The stock is one of those used to calculate the S&P 500 Index. Over the past twelve months, it has traded between $42.75 and $83.97. A stop-loss of $72.50 looks good here. Note that the firm is expected to release fourth quarter results in the second week of October.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.

So how do you square being a company that sells crop seeds with the fact that you are also a big producer of herbicides? A well-known outfit in St. Louis has just the right answer. It simply alters its seeds genetically, so that they tolerate its herbicides.

Monsanto Company (NYSE:MON) provides agricultural products to farmers worldwide. The company produces seeds and develops biotechnology traits that assist farmers in controlling insects and weeds. Products include canola, corn, soybean, fruit, cotton, sunflower and sorghum seed. The firm also manufactures the world's leading herbicide, Roundup. Monsanto's proposed acquisition of cottonseed producer Delta and Pine Land (NYSE: DLP) is now being reviewed by the U.S. Department of Justice.

Last week, the firm reported Q2 EPS of 98 cents and revenues of $2.62 billion. Analysts had been expecting 93 cents and $2.44 billion. Management also guided FY07 EPS to $1.60-$1.65, versus consensus of $1.63. MON shares popped above 50-day moving average support on the news and entered the initial stage of a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling when they entered them. In this case, that would be to the upside.

Brokers recommend the shares with three "strong buys," three "buys," six "holds" and one "sell." Analysts see a 22% growth rate through the next year. The MON Price to Book ratio (4.37), Price to Free Cash Flow ratio (25.28), Sales Growth rate (18.91%) and EPS Growth rate (22.50%) compare favorably with industry, sector and S&P 500 averages.

Institutions hold about 82% of the outstanding shares. The stock is one of those used to calculate the S&P 500 Index. Over the past twelve months, it has traded between $37.91 and $59.66. A stop-loss of $50.00 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com.