Morningstar Rating

Stock Research and Analysis

by Jeffrey Stafford, CFA

Bulls Say

Declining arable land per person will force growers to be more productive and should drive growth in crop inputs.
Increasing demand for meat in China, India, and other emerging markets should support grain prices, motivating farmers to increase yields through greater fertilizer and chemical use.
The retail agriculture market is very fragmented, leaving Agrium room to steadily snap up smaller competitors and increase its share lead and bargaining power with suppliers. Read more 

Bears Say

Volatile pricing and demand for crop nutrients have characterized Agrium's business during the past few years, highlighting the cyclical nature of the company's cash flows.
Through subsidies and state-run companies, governments influence about half of the nitrogen and phosphate markets worldwide.
A lower-cost natural gas region could exploit inherent advantages in nitrogen production and drag down worldwide prices. For example, gas prices in the Middle East and North Africa are traditionally much lower than in Canada. Read more 

Management

Chuck Magro succeeded Michael Wilson as CEO at the beginning of 2014. Before his CEO appointment, Magro was Agrium's COO. During Wilson's tenure, the company tripled sales, fueled by numerous reasonably priced acquisitions. In our opinion, the firm   Read more 

Profile

With more than 1,250 retail centers, Canada-based Agrium is the largest agricultural retailer in the United States, selling fertilizers, crop chemicals, and seed directly   Read more 

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