Nutrien (TSX:NTR) is a Saskatoon-based company that produces and market crop nutrients to agricultural, industrial, and feed customers around the world. Its shares have dropped 18% year-over-year as the company has been forced to navigate a challenging environment in its industry. The agricultural sector has battled global trade tensions, a farm labour gap, and other issues. Fortunately, Nutrien stock bumped up 2.9% over the past week as of close on February 21.
So, why is Nutrien a good deal for value investors right now? The company released its fourth quarter and full-year results for 2019 on February 18. Nutrien generated $2.2 billion in free cash flow in 2019, which was up 9% from the prior year. Retail EBITDA moved up 2% for the full year, while Potash and Nitrogen EBITDA suffered sharp drops in Q4.
Potash was negatively impacted by a temporary reduction in global demand, as well as the impact of production downtime and the Canadian National Railway strike. Nitrogen suffered from lower ammonia sales and a lower nitrogen net realized selling price.
Shares of Nutrien last possessed a price-to-earnings ratio of 24 and a price-to-book value of 1. These are both very favourable levels relative to industry peers. Even better, Nutrien also offers some income for bargain hunters out there. The stock last paid out a quarterly dividend of $0.45 per share. This represents a nice 4.2% yield. Now is a great time to jump on Nutrien stock.
