Agrium (AGU.TO)

Prefers Tyson Foods. Packaged foods with higher margins.

Because of the miserable weather in the US, in the short term he sees pressure on prices of ammonia, urea, potash and phosphate. If farmers think there is not going to be much of a growing season, they will hold back on buying fertilizer. His target is $114-$120.

They used to own it, and have sold it on the way up. He likes the business and management. The stock has risen a lot and there is some weakness in nitrogen pricing. You could buy it here, though because it is a strong business.

This is the time of year to buy agriculture. But there are headwinds. Late US crop due to weather. Nat Gas prices are higher and it is an input cost. Second quarter is the big one for them. Weather could hold back some of their orders. He would prefer Monsanto. He is short the stock.

It was a seasonal play for him. It is later in the year. It broke down from its uptrend. POT would be a better place for an execution/valuation play.

He tends to use a bit of seasonal analysis. For this sector it is often weak at this time of year. You can see it peaked in January. Now we have broken an area of support. It is the neckline. Not all that positive yet. He might be tempted to trail a tight stop behind it.

Fundamentally a good company. You have to let the market digest things a bit. The current corn crop is a bit late, so there may be a bit of a lag in AGU going up. Upcoming earnings expected to be 19% lower but are already built into the price. It could be a trading range stock at $80-$100.

(Market Call Minute.) Likes the company. Macro overview is a little bit weak in the short term. If it dropped another $5 he would probably be a buyer.

Fertilizer is a long-term growth business but farmers don’t have to buy it every year. If corn and grain prices are high, they’ll buy more fertilizer and get the value out of it. If those prices are low, they live with less fertilizer. He is looking at this one.

Low 90s was first area of support. We are at a 50% retracement from the highs. Would be an area to nibble away at it.

Fast money is finally out of the game. Real world, what happens here? A little expensive. A good retail franchise. Prefers POT from a valuation perspective.

(Top Pick Apr 25/12, Up 0.01%) Likes it for a 3-5 year hold. Growth of population and developing nations’ middle class require more and more food. Extreme weather conditions have created doubts about demand for fertilizer this year. Likes this one for its retail exposure. He would buy it.

Thinks the Janna business is over with. Sales integrated with the product production is excellent. Well-run company. Global. Big in North America. Has dropped into a buying range. Good way to participate in a growing agriculture sector. Yield of 2.17%.

Proxy fight regarding the splitting of the company now seems to be over. The recent tragedy in Texas may be an opportunity for it. Likes the retail space that it is in. A commodity stock and they have no control over the prices. Corn prices have come down a little bit so farmers may be less flush with cash. If you have a very, very long-term horizon, just pop it into your portfolio and don’t look at it.

Thinks this is getting more interesting with the recent pullback. Janna Partners bid, (big US hedge firm who was trying to get them to spin out one of their businesses) was unsuccessful. As this played out, the stock has come off quite significantly and trades at a pretty low multiple, 10X earnings, and pays a 2% dividend yield. On his radar screen. Could be an interesting name to look at.