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Bull of the Day: Nutrien (NTR)

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Nutrien Ltd (NTR - Free Report) recently raised half year guidance due to the strength in the global fertilizer markets. This Zacks Rank #1 (Strong Buy) is now expected to grow earnings by 96% in 2021.

Nutrien is the world's largest provider of crop inputs and services. It produces around 27 million tonnes of potash, nitrogen and phosphate products world-wide.

It also has a significant agribusiness, including its retail segment, Nutrien Ag Solutions.

Nutrien Raised Half Year Guidance

On June 21, Nutrien announced it was raising its first-half 2021 earnings guidance given the strength in the global fertilizer markets.

It now expects earnings to be in the range of $2.30 to $2.50, up from its prior guidance of $2.00 to $2.20.

It also announced it would increase its production of potash by another half a million tonnes. This is in addition to the half a million tonne increase announced on June 7, 2021.

Combined, the company now expects to produce one million tonnes of incremental potash in 2021 compared to earlier expectations.

The majority of this increased production is expected to occur in the fourth quarter, with some additional tonnes expected to be sold in early 2022.

"With continued strength in global agriculture and crop input markets, we are raising guidance and expanding our potash production by a total of one million tonnes to ensure farmers get the potash they need,” said Mayo Schmidt, Nutrien’s President and CEO.

Analysts Raise Earnings Estimates

Nutrien will provide updates to its full year guidance in its second quarter results in August.

However, it did says it expects the midpoint of its 2021 EPS guidance to be above the top end of the ranges previously provided in the first quarter results.

Therefore, it's not surprising that analysts are already raising full year earnings estimates.

One analyst has already raised for 2021, pushing the Zacks Consensus up to $3.54 from $3.49. That's earnings growth of 96.7% from 2020 where the company earned just $1.80.

Revenue is also expected to rise 15% to $23.99 billion from $20.86 billion last year.

In its first quarter results, Nutrien had record first quarter Retail results and saw strong fertilizer volumes and margins.

It looks like the strong market conditions are continuing.

Shares at 2-Year Highs

Nutrien has rallied big off its 2020 lows as the agriculture cycle heats up.

Year-to-date the shares are up 26.4% and have been at 2-year highs. But they've taken a break in the last month, as they pulled back off the highs.

Zacks Investment ResearchImage Source: Zacks Investment Research

They're attractively priced with a forward P/E of 17.3.

It's also shareholder friendly, with a dividend currently yielding 2.2%.

Nutrien's not the only fertilizer producer that's a Zacks Rank #1 (Strong Buy). CF Industries Holdings Inc. (CF - Free Report) also holds that distinction.

But The Mosaic Company (MOS - Free Report) is currently a Zacks #3 (Hold).

For investors looking for a way to get into the hot agriculture sector, Nutrien should be on your short list.

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