Yahoo Finance Here's Why Nutrien (NTR) Stock is a Solid Choice Right Now
Nutrien Ltd.’s NTR stock looks promising at the moment. The fertilizer maker’s shares have gained roughly 12% over the past three months. It is benefiting from higher prices and healthy demand for crop nutrients.
We are positive on the company’s prospects and believe that the time is right for you to add the stock to the portfolio as it looks promising and is poised to carry the momentum ahead.
Let’s delve deeper into the factors that make this Zacks Rank #1 (Strong Buy) stock an attractive choice for investors right now.
An Outperformer
Shares of Nutrien have rallied 42.8% year to date against the 27.9% rise of its industry. It has also outperformed the S&P 500’s 20.8% rise over the same period.
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Estimates Northbound
Earnings estimate revisions have the greatest impact on stock prices. Over the past two months, the Zacks Consensus Estimate for Nutrien for the current year has increased 11.5%. The consensus estimate for fourth-quarter 2021 has also been revised 61.4% upward over the same time frame.
Positive Earnings Surprise History
Nutrien has outpaced the Zacks Consensus Estimate in three of the trailing four quarters. In this time frame, it has delivered an average earnings surprise of roughly 73.5%.
Solid Growth Prospects
The Zacks Consensus Estimate for earnings for the current year for Nutrien is currently pegged at $5.62, indicating year-over-year growth of 212.2%. Moreover, earnings are expected to register 787.5% growth in the fourth quarter of 2021.
Growth Drivers in Place
Nutrien should benefit from solid demand and higher prices for fertilizers, especially potash, supported by the strength in global agriculture markets. It is expected to gain from strong potash sales volumes this year on the back of solid domestic and overseas demand.
The company is also gaining from higher net realized selling prices for crop nutrients as witnessed in the third quarter. It saw higher sales across all the segments in the quarter, driven by higher prices and strong demand.
Potash prices have strengthened on the back of robust global demand, aided by strong grower economics, higher crop prices and low global inventory levels. Tight availability along with firm demand is also driving up phosphate prices globally. Lower global supply availability stemming from reduced operating rates and a spike in energy prices have also boosted nitrogen prices. Higher prices are expected to drive the company’s sales and margins for full-year 2021.
Nutrien is also taking actions to boost potash production in the wake of tightening global potash market conditions. The move is in response to strong market fundamentals and is geared to enable its customers have the crop inputs they require to feed a growing population. The company expects to produce one million tons of incremental potash in 2021 as a result of this move.
The company is also well placed to gain from acquisitions, cost efficiency, and increased adoption of its digital platform. It also continues to expand its footprint in Brazil through acquisitions, including Tec Agro.
Nutrien, on its third-quarter call, raised its adjusted earnings per share and adjusted EBITDA guidance to $5.85-$6.10 (from previous view of $4.6-$5.1) and $6.9-$7.1 billion (from earlier view of $6-$6.4 billion), respectively, for full-year 2021. It expects strong demand for crop inputs in the fourth quarter as well as tight global fertilizer supply and demand fundamentals to continue into 2022.
Nutrien Ltd. Price and Consensus
Nutrien Ltd. price-consensus-chart | Nutrien Ltd. Quote
Stocks to Consider
Other top-ranked stocks worth considering in the basic materials space include Univar Solutions Inc. UNVR, AdvanSix Inc. ASIX and Intrepid Potash, Inc. IPI, each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Univar has an expected earnings growth rate of 55.2% for the current year. The Zacks Consensus Estimate for UNVR's current-year earnings has been revised 11.2% upward over the last 60 days.
Univar beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 24.1%. UNVR has rallied around 48% in a year.
AdvanSix has a projected earnings growth rate of 196.9% for the current year. ASIX's consensus estimate for the current year has been revised 6.8% upward over the last 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 46.9%. ASIX has rallied around 118% in a year.
Intrepid Potash has a projected earnings growth rate of 244.7% for the current year. The consensus estimate for IPI’s current year has been revised 3.3% upward over the last 60 days.
Intrepid Potash beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 132.9%, on average. IPI shares have surged around 151% in a year.
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