Is Potash Corp. Set to Grow With Global Agriculture?

Two other companies often mentioned as beneficiaries as higher agriculture demand are Agrium Inc. (NYSE:AGU), a $15 billion market cap wholesaler and retailer of supplies including fertilizer and crop protection products, and Monsanto Company (NYSE:MON). Agrium is currently in an activist battle with hedge fund JANA Partners, which wants the company to split its wholesale and retail businesses. It trades at 11 times trailing earnings, with analysts expecting little growth in the next couple years, and with sales actually growing a bit recently we think it’s another stock worth taking a closer look at considering its valuation. Monsanto is priced for high growth, at 20 times consensus earnings for the fiscal year ending in August 2014. However, it too has been on the rise with revenue up strongly in its last quarterly report (and earnings more than doubling) compared to the same period in 2011. We’d be interested in seeing how strong its growth prospects are.

Potash Corp. actually ends up as one of the less attractive options for investors looking to benefit from agricultural trends. While the company does have potential, even in terms of fertilizer opportunities CF seems more interesting while Monsanto and Agrium seem quite worthy of investors’ attention as well.

Disclosure: I own no shares of any stocks mentioned in this article.