Agrium (AGU-T)

(A Top Pick July 28/17 - Up 26%.) Merged into Nutrien (NTR-T). Saw opportunity at that time. Modeling 25% EPS growth. Still upside on this name.

Doesn't think you should get into this right now. He did own it, but when they announced that they were going to integrate with Potash (POT-T), that changed the complexion of the company quite a bit. Doesn't think there will be much in the way of a stock price change until it has been time-tested for a while.

This has been flat year-over-year. They are merging with Potash (POT-T), so will be able to take some synergies out. Because of the regulators globally, they have to sell about a net amount of $4.5 billion of assets. They’ll probably invest some of those proceeds in the retail part of the business, which is more stable. They’ll also probably buy back shares, as well as increasing dividends in about 3 years. Dividend yield of 3.2%. (Analysts’ price target is $111.20.)

They are targeting the 4^th quarter to complete their merger with Potash (POT-T). The new company is going to be called Nutrien.

Wasn't impressed with the Potash (POT-T) acquisition. They could have bought it for a lot less. It could be a drag for them right now, because commodity prices are still down. This is a good business in that they are able to generate good operating income, so margins are good. They are only one of 2-3 players in the space.

(A Top Pick Nov 10/16. Up 5%.) He bought this after the merger was announced last September. This is now an agricultural conglomerate that you get to own in Cdn$, a great thing for both our economy and Canadian investors. A global leader.

These agricultural plays do well to the end of the year. Remember all the farmers are placing orders for the new year. Shipments into the 1^st quarter between Oct 3 and Jan16 shares of Agrium have gained 13.29% and been positive in 17 of the past 20 periods. This year, shipments of fertilizers have been dismal. You could argue that weather is to blame. If commodity prices are going to pick up this year, we could see a very good period of seasonal strength. The chart is showing it starting to break out. (Analysts’ price target is $106.10.)

POT-T & AGU-T. AGU-T was a buy and hold when he was last on. It has been kind of bouncing around. He has always liked the retail part. Also, it is global. The Texan floods could impact AGU-T with a psychological effect on investors. POT-T is starting to perk up in the US and they signed a Chinese contract. He would not sell out just because of the merger.

POT-T and AGU-T amalgamation. Mid-October is the expected merger date. He thinks it is a positive to have them together. These are such big companies that the market has discounted synergies. You will get a lower yield on POT-T after the merger which some may not like. He sees it net sideways from here. He does not like the fertilizer outlook from here. He would rather miss the first 5-10% to see if it trends up.

He has not been in the fertilizer group for a couple of years. He needs a dividend plus growth of 10%. It has great potential after the merger. There is nothing wrong with it fundamentally, but just that no money is flowing into the sector.

There is a merger on the horizon with Potash (POT-T) which he likes. The merged company should trade at $57. If we go into a more normal commodity environment for potash and nitrogen, this stock should be around $57. Dividend yield of 3.6%. (Analysts’ price target of $99.50.)

Their merger with Potash (POT-T) is expected to close at the end of this quarter. It hasn’t been approved, but she expects it will be. She intends to continue holding this after the merger.

He previously recommended holding it. Fertilizer prices have been in the doldrums. Fertilizer plays often follow corn prices. There is no sign of a drought. He has always loved the company on the retail side. There will be some remedies in the merger with POT-T and you get a good yield while you wait.

The merger with Potash (POT-T) was really necessary. If you are going to own an agricultural stock, this is the one to own. Agrium has the retail side which gives some insulation. The bigger challenge for potash is that there is still a lot of supply out there. Supply needs to come down to give some breathing room for the commodity price to actually rise. Trading at about 18X PE with a yield of about 4%. He would like to see this considerably cheaper given the uncertainty with commodity prices.