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TSE:AGU

Agrium (AGU.TO)

TOP PICK
More diversified than Potash (POT-T). Their retail gives a little bit of cushion.
PAST TOP PICK
(A Top Pick March 13/09. Up 46.98%.)
BUY
Drop in today's stock price was probably in sympathy with Potash (POT-T) downgrade by Goldman Sachs. They provided a fairly cautious view of the fertilizer industry over the next 6-8 months. The downgrade is probably a short-lived phenomenon so not a bad buying opportunity.
BUY
There are signs that the demand in fertilizer is coming back in 2010, which would allow the stock to continue to move up.
BUY
Because the deal with C. F. Industries didn't go through, they are in much better shape financially leaving a cleaner balance sheet. If there is a selloff in the market, they can look for possible acquisitions without overpaying.
PAST TOP PICK
(A Top Pick May 13/09. Up 32%.) Likes this as a trading stock. Might pick it up if it drops down to the mid-$60 where he expects some support. Also has good volume.
DON'T BUY
Very gutsy way to play agriculture. Selling at a higher multiple of over 16 X next year's forecast earnings. Have dropped their bid for C. F. Industries.
TOP PICK
Buy Oct ’74 Calls @$7.25. If the market continues to go and inflation stays in check, some of the commodity producers could do quite well.
TOP PICK
Fertilizer market has strengthened since 4th quarter of last year. Indications are that farmers will get their prices giving them good margins. Even if economy doesn’t retrace and stays as it is, this bodes well for prices of potash and this company. Use a 10%-12% stop loss.
WAIT
Overhead because of acquisition of CF industries. Need to wait to see how it plays out and then you could see a bounce back. It is the best gears for the Nitrogen complex in Canada. You could see some movement in the sock later on.
DON'T BUY
Surprised how well it has done compared to POT-T. His favorite name is POT-T. Worried they will get into a bidding war for CF. Nitrogen prices are quite low and earnings are not going to be great in 2010.
BUY
Just came out with great earnings, well above expectations. Also improved guidance for the balance of the year. Reasonable value at 15X this year's earnings and 12X next. Just popped above the 50 day moving average so you may want to wait for it to confirm this move but still a good entry point.
DON'T BUY
He is positive on the fertilizer area and feels potash negotiations will go better than feared. Good growth area over the next few years. Caught in the hostile takeover battle with CF Industries. He prefers Potash (POT-T).
WAIT
Will be reporting earnings very soon and he would wait until that is finished. Vertically integrated with everything from producing fertilizers to selling and distributing a whole range of agricultural products. Inexpensive.
DON'T BUY
Agriculture has a period of seasonal strength from August right through until the end of the year. Had a little pop recently because Belarus Potash increased the price of potash fertilizer by 6%. However, you are past the seasonal strength.
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