Mentioning the blockade of the Strait of Hormuz on October 2, a caller asked whether Nutrien Ltd. (NYSE:NTR) presents an investment opportunity in the fertilizer sector. Mad Money host Jim Cramer replied:
The fertilizer trade, you know what? I think that trade has come and gone. I think people got real excited about it. They made some money, and then they left. It’s not an expensive stock, but I don’t like that kind of, that’s too hard a catalyst… for me to be able to get behind it.
Nutrien’s last earnings results pointed in two very different directions, with strength in one part of the business offsetting weakness elsewhere. Here’s what was really driving the company’s higher outlook.
Potash Performance Provides a Broader Investment Case
Nutrien Ltd. has operating strengths beyond a possible disruption-driven fertilizer trade. First-half potash adjusted EBITDA increased to $1.24 billion, supported by higher benchmark prices and record sales volumes. The company also reported record production and progress with mine automation, keeping controllable manufacturing cash costs below $60 per tonne.
Its retail business generated $1.24 billion in first-half adjusted EBITDA, helped by higher proprietary-product margins and strength in Australia’s livestock market. For the second quarter overall, Nutrien reported $1.22 billion in net earnings and $2.43 billion in adjusted EBITDA. These businesses give investors more to assess than the direction of fertilizer prices alone. Nutrien was already being singled out as a cheap growth stock, but analysts were questioning how much of its earnings strength could last. That concern may be worth revisiting now.
Supply Constraints Can Hurt Producers Too
A development after Cramer’s comments highlights the operational complications. On October 5, Nutrien Ltd. announced an indefinite shutdown of its Trinidad nitrogen operations because of continuing natural gas constraints and uncertainty. The facility had already been shut since October 2025. Importantly, the decision did not change 2026 nitrogen sales-volume guidance, which already assumed no Trinidad production. Management said the decision was intended to improve free cash flow and returns on invested capital. Higher selling prices also do not necessarily translate into higher profits. The company’s phosphate-adjusted EBITDA declined in the second quarter and first half as rising sulfur costs outweighed the benefits of stronger prices and sales volumes.
Nutrien’s valuation is mixed relative to fertilizer peers. The stock trades at 13.45x forward earnings, below Mosaic’s 23.6x but above CF Industries’ 9.1x. That puts Cramer’s comment into better perspective. Nutrien is not expensive, but it is not cheaper than all of its peers either. Differences in product exposure also limit a simple comparison.
More Hedge Funds Hold Nutrien
Insider Monkey’s Q2 data showed 47 hedge funds owning Nutrien Ltd., up from 43 in the preceding quarter. Among the 1000+ hedge funds Insider Monkey tracks, First Eagle Investment Management was the largest shareholder with 9.97 million shares in Q2. Short interest was 1.59% of the public float.
Cramer is reluctant to chase a trade tied to geopolitical disruption. Nutrien’s biggest strength is its established production and retail business, although both areas still face cost and supply pressures. Investors considering the shares need a reason to own them after the immediate fertilizer headlines fade.
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