Chris Blumas Nutrien Ltd. NTR-T DON'T BUY Jun 18, 2024

Bumpy. Q2 is a crucial selling season for them, and supply/demand dynamics in potash will be key. Reintroduced it to portfolios in January this year. Fertilizer cycle has bottomed and is slowly turning up. Vertically integrated with downstream farm supply stores. Operational improvement in South America to improve margins.

Trading at half of peak value of 3 years ago. Lots of upside.

Same play as ADM: has been reversing a long-term downtrend and recently has been moving up. Investors who had ignored this are now coming back.

Should be affected by tariffs, but it's actually not because of its Canadian and US standalone businesses. Inexpensive. Capital intensive, so the rate of return is not as high as he'd like. Agriculture seems to be working its way out of a funk.

Likes it, as well as its US counterpart MOS. Part of his bias toward commodities. Downtrend ended, rounded bottom, now forming a neckline. Trying to break out; hasn't yet, but chart and fundamentals are set up to do so. Could get quite a bit higher, but you have to be patient (it's a commodity, and there's a cycle at work).

World's largest crop nutrient business. Upstream production vertically integrated with downstream stores (in US, Canada, and some in South America). Commodity prices for the 3 fertilizer ingredients has bottomed, supported by steadily improving prices for major cash crops (corn, wheat, soybeans). 

Trades roughly at long-term average multiple. Earnings on cusp of a turning point. Dividend's increased 36% since merger in 2018, plus reduced outstanding shares by 23% since then. Yield 3.6%.

Is fairly valued. Has returned 59% over 5 years. The problem is that if the fertilizer price gets too high, farmers delay buying it. The PE is reasonable, though. It's had a good run the past 12 months.

The 3-year chart shows the longer-term downtrend and how it's now beginning to come out. Pulling back recently. Around $75 will be pretty important support. Technicals show it's turned a corner. Doesn't mind nibbling here.

Lots of geopolitical things happening. When stock shot up from Russian invasion, sold some but still retains a 1/2-2/3 position. Likes it long term. BHP is bringing on Jansen, but it's behind (and second phase may be mothballed). Good diversifier. Nice yield.

For new clients, buying a half position. Ideally, want to buy under $70.

Choppy stock, pretty volatile. But you can see the nice uptrend on the chart, which helps you digest the highs and lows. After a big downtrend, you had basing, and then a nascent uptrend -- stock's looking through bad news, just be patient. Can still buy today and do well.

Bought a position on the sense of a turning point in the fertilizer price cycle. Bit of a fade in last couple of weeks in some agricultural commodities. Patience will be rewarded. Financially strong. Downstream segment's margins are improving. Yield is close to 4%.