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Highlights

• Nutrien is one of the largest agricultural retailers in the USA, selling seeds, fertilizers, crop chemicals, and providing services to farm customers.
• The firm posted a 20.2% YoY decline in its revenue in Q1 2023.
• For 2023, NTR expects its adjusted net earnings per share to be between USD 5.5 and USD 7.5 per share.

Nutrien Ltd (TSX: NTR) is one of the largest fertilizer producers in the world, in terms of capacity. It is involved in the production of three main crop nutrients – phosphate, potash, and nitrogen. However, in case of potash, it stands as one of the global leaders in installed capacity with nearly 20% share.

Interestingly, Nutrien is also one of the largest agricultural retailers in the USA, selling seeds, fertilizers, crop chemicals, and providing services to farm customers.

How did NTR perform in Q1 2023?

During the first quarter of the year 2023, Nutrien posted industry beating profitability margins and debt to equity ratio. Also, it recorded an increased current ratio and cash and cash equivalents.

As per the company, this is primarily because the demand for crop inputs has increased with the northern hemisphere's spring planting season moving along and higher-cost inventory coming through the channel.

Moreover, the fertilizer markets' ongoing stability after a year of exceptional volatility has lifted the business.  The demand is likely to rise further in Q2 2023 on grounds of solid agricultural fundamentals.

Nutrien experienced a 20.2% year-on-year decline in its revenue in Q1 2023 on prior corresponding period. Also, NTR’s earnings before taxes decreased by 59.3%. The company believes that this was due to weak performance from Crop nutrients segment and Crop protection products segment, along with lower selling prices.

Outlook for FY23

Looking on the brighter side of the overall developments, Nutrien expects expansion in the major crop planted area in the USA by nearly 8 million acres in 2023. Also, considering improvement in affordability ratios, the firm is expecting higher application rates in South America for the 2023 summer crop planting season.

As per management guidance for 2023, NTR expects its full-year 2023 adjusted EBITDA and adjusted net earnings per share to be between USD 6.5 - USD 8.0 billion, and USD 5.5 - USD 7.5 per share, respectively.

Top 10 shareholders
The top ten shareholders of the company hold approximately 26.44% of the total shareholding. The maximum stake of 4.23% is held by T. Rowe Price Associates, Inc., while The Vanguard Group, Inc. has around ­­­3.59% stake in the company.

Stock Price Performance
The company stock price has decreased by 2.19% in the last 30 days. It has witnessed a drop of approximately 18.01% over the last 3 months. The stock’s 52-week high and low price stands at CAD 132.75 and CAD 70.685, respectively.

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: Past performance is not a reliable indicator of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is July 17, 2023. The reference data in this report has been partly sourced from EODHD/Others.