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Nutrien Ltd (TSE:NTR)
TSX:NTR
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Nutrien
(TSX:NTR)70Outperform
Positive Factors
Crop Prices
The ag complex narrative has improved somewhat since the USDA's report, which showed tighter-than-expected corn supply/demand trends, resulting in an uptick in corn prices.
Potash Market
There is optimism about the potash market with improving prices and strong demand in regions like Southeast Asia and China.
Retail Performance
Retail EBITDA of $340M was 48% higher than the previous year on higher crop protection and seed margins, and lower expenses.
Negative Factors
Brazil Losses
Brazil is expected to incur a significant loss this year, which is a major reason for the downward revisions in guidance.
Brazil Market
Brazil retail landscape remains challenging due to market instability.
Earnings Growth
A lack of earnings growth and limited prospects for sustained higher fertilizer prices will weigh on sentiment.
Nutrien (NTR) vs. S&P 500 (SPY)
Market Cap
$34.35B
Dividend Yield4.38%
Average Volume (3M)1.44M
Price to Earnings (P/E)37.6
Beta (1Y)1.08
Revenue Growth-13.24%
EPS Growth-65.53%
CountryCA
Employees25,900
SectorBasic Materials
Sector Strength56
IndustryAgriculture
Share Statistics
EPS (TTM)1.87
Shares Outstanding489,258,820
10 Day Avg. Volume1,568,691
30 Day Avg. Volume1,439,864
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.94
Price to Cash Flow (P/CF)-6.90
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$85.12Price Target Upside21.23% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering16
Nutrien Business Overview & Revenue Model
Company DescriptionCanada-based Nutrien Ltd. is a crop nutrient company, which produces and distributes potash, nitrogen and phosphate products for agricultural, industrial and feed manufacturers.
How the Company Makes MoneyNutrien makes money primarily through the sale of crop nutrients, including potash, nitrogen, and phosphate. As one of the largest producers of these essential fertilizers, Nutrien leverages its extensive production capabilities and distribution network to meet global demand. The company also generates revenue from its retail operations, which involve selling seeds, crop protection products, and providing agronomy services directly to farmers. Additionally, Nutrien benefits from strategic partnerships and joint ventures that expand its market reach and operational efficiency. Factors such as global agricultural trends, commodity prices, and technological advancements in farming practices significantly influence Nutrien's earnings.
Nutrien Financial Statement Overview
Summary
Nutrien's financial statements show a stable financial position with moderate profitability and cash flow metrics, though revenue growth has declined. The balance sheet is solid, with a manageable debt-to-equity ratio, but there is room for improvement in net income and return on equity.Income Statement
Nutrien's income statement shows moderate performance with a Gross Profit Margin of approximately 29% and a Net Profit Margin of 2.76% for the TTM. The Revenue Growth Rate has declined by 5.44% from the previous year, indicating a reduction in top-line growth. However, the EBIT and EBITDA margins are relatively stable at 9.43% and 17.90%, respectively, suggesting operational efficiency despite the revenue contraction.65
Positive
Balance Sheet
The Balance Sheet reflects a stable financial position with a Debt-to-Equity Ratio of 0.59, which is manageable within the industry context. Return on Equity stands at 2.94%, indicating room for improvement in profitability from equity. The Equity Ratio is healthy at 48.08%, suggesting a solid equity base supporting the company's asset structure.70
Positive
Cash Flow
Cash flow analysis reveals a positive Free Cash Flow Growth Rate of -4.71% year-over-year, which shows a slight decrease in free cash flow generation. However, the Operating Cash Flow to Net Income Ratio is robust at 6.22, indicating strong cash generation relative to net income. The Free Cash Flow to Net Income Ratio is 3.11, further reflecting solid cash flow backing net profits.75
Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 26.56B | 28.08B | 37.88B | 27.71B | 20.91B | 20.02B | Gross Profit |
| 7.72B | 8.47B | 15.42B | 9.41B | 5.24B | 5.44B | EBIT |
| 2.50B | 4.35B | 10.81B | 4.78B | 1.61B | 1.86B | EBITDA |
| 4.75B | 4.88B | 12.07B | 6.58B | 2.89B | 3.67B | Net Income Common Stockholders |
| 733.00M | 1.26B | 7.66B | 3.15B | 459.00M | 992.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 941.00M | 941.00M | 901.00M | 499.00M | 1.45B | 671.00M | Total Assets |
| 52.75B | 52.75B | 54.59B | 49.95B | 47.19B | 46.80B | Total Debt |
| 12.57B | 12.57B | 11.93B | 10.85B | 11.36B | 11.10B | Net Debt |
| 11.63B | 11.63B | 11.03B | 10.35B | 9.91B | 10.43B | Total Liabilities |
| 27.55B | 27.55B | 28.72B | 26.25B | 24.83B | 23.93B | Stockholders Equity |
| 25.16B | 25.16B | 25.82B | 23.65B | 22.36B | 22.87B |
| Cash Flow | Free Cash Flow | ||||
| 2.28B | 2.40B | 5.67B | 2.10B | 1.77B | 1.77B | Operating Cash Flow |
| 4.56B | 5.07B | 8.11B | 3.89B | 3.32B | 3.67B | Investing Cash Flow |
| -2.35B | -2.96B | -2.90B | -1.81B | -1.20B | -2.80B | Financing Cash Flow |
| -2.26B | -2.06B | -4.73B | -3.00B | -1.34B | -2.48B |
Nutrien Technical Analysis
Negative
70.21
Price Trends
71.99
Negative
68.92
Positive
68.00
Positive
Market Momentum
0.22
Positive
38.90
Neutral
22.75
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:NTR, the sentiment is Negative. The current price of 70.21 is below the 20-day moving average (MA) of 73.84, below the 50-day MA of 71.99, and above the 200-day MA of 68.00, indicating a neutral trend. The MACD of 0.22 indicates Positive momentum. The RSI at 38.90 is Neutral, neither overbought nor oversold. The STOCH value of 22.75 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:NTR.
Nutrien Peers Comparison
Overall Rating
UnderperformOutperform
Sector (47)
Financial Indicators
Performance Comparison
TSE:NTR
Nutrien
71.60
3.75
5.53%
CBWBF
Canadian Western Bank
39.71
19.23
93.90%
TSE:AGT
Applied Graphite Technologies Corporation
0.10
>-0.01
-9.09%
Nutrien Earnings Call Summary
Earnings Call Date: Feb 19, 2025 | % Change Since: -5.88% | Next Earnings Date: May 7, 2025
Earnings Call Sentiment Positive
Nutrien demonstrated strong performance with record potash volumes, significant retail EBITDA growth, and accelerated cost savings. However, challenges such as lower fertilizer prices, phosphate EBITDA decline, and tariff uncertainties persisted. Overall, the positive achievements slightly outweigh the lowlights.Highlights
Record Potash Volumes
Nutrien sold record potash volumes and progressed nitrogen brownfield expansions at two North American sites.
Retail Adjusted EBITDA Growth
Retail adjusted EBITDA totaled $1.7 billion, up 16% from the prior year, driven by stronger-than-expected crop protection margins in North America and improved Brazilian retail performance.
Cost Savings Acceleration
Nutrien accelerated the timeline for achieving $200 million in annual cost savings, expecting to achieve this target in 2025, one year earlier than initially planned.
GHG Emissions Reduction
Achieved a 15% reduction in total Scope 1 and 2 GHG emissions intensity in 2024 compared to the 2018 base year.
Dividend Growth
The dividend per share has been increased seven times since the beginning of 2018, with a total increase of 36%.
Lowlights
Lower Fertilizer Prices Impact
Adjusted EBITDA of $5.4 billion in 2024 was impacted by lower fertilizer prices, which more than offset increased downstream retail earnings.
Phosphate EBITDA Decline
Phosphate adjusted EBITDA was $384 million, down from the prior year, primarily due to lower production impacted by weather-related events and plant outages.
Tariff Uncertainty
Potential impacts of tariffs on Canadian potash exports to the U.S. could affect market dynamics, with costs likely passed on to U.S. farmers.
Ammonia Market Weakness
Ammonia prices declined entering 2025 due to weak fall application and new supply concerns, although optimism remains for the spring season.
Company Guidance
During Nutrien's 2024 Fourth Quarter Earnings Call, the company provided guidance on various financial metrics and strategic goals. Nutrien achieved an adjusted EBITDA of $5.4 billion for 2024, despite lower fertilizer prices, due to increased downstream retail earnings, higher upstream fertilizer volumes, and reduced costs. Retail adjusted EBITDA reached $1.7 billion, marking a 16% increase over the previous year, driven by stronger-than-expected crop protection margins in North America and improvements in Brazilian retail performance. The company also reported a 7% reduction in potash controllable cash cost per tonne due to increased production and automation efforts. For 2025, Nutrien forecasts global potash shipments between 71 million to 75 million tonnes and anticipates U.S. corn acreage to rise to 91 to 93 million acres. The company set an annual potash sales volume guidance of 13.6 to 14.4 million tonnes, reflecting uncertainties such as potential tariffs on Canadian exports. Additionally, Nutrien aims to achieve $200 million in annual cost savings by 2025, a year ahead of schedule, and plans capital expenditures of $2 billion to $2.1 billion. The company continues to focus on strategic investments, share repurchases, and maintaining a stable and growing dividend.Nutrien Corporate Events
Nutrien’s Q3 2024 Earnings Highlight Potash Success
Nov 6, 2024
Nutrien has reported a net earnings of $25 million for the third quarter of 2024, bolstered by record Potash sales volumes and lower operating costs, alongside strong retail product margins in North America. The company has focused on strategic priorities to enhance business advantages, aiming for structural improvements in earnings and cash flow. Nutrien’s operational efficiency initiatives are expected to yield $200 million in annual savings by 2025, ahead of schedule.
Nutrien Announces US$0.54 Quarterly Dividend
Nov 6, 2024
Nutrien Ltd. has announced a quarterly dividend of US$0.54 per share, payable on January 17, 2025, to shareholders of record as of December 31, 2024. Shareholders in Canada will receive their dividends in Canadian dollars, while those outside of Canada, including the US, will receive them in US dollars, with the option to change the currency. Nutrien offers direct deposit for dividend payments, enhancing convenience for its investors.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.