As far as value stocks go, Nutrien Inc. (TSX:NTR)(NYSE:NTR) is near the top of my list right now as a stock that has a long runway for growth not only in 2021 and the years to come, but for decades. This is a stock I’ve been bullish on in the past, however, I think the stars are aligning to provide a very bullish case for long-term growth in excess of what I previously thought possible.
The first key catalyst for such growth is the potential for a clearing up of the oversupply which has persisted in the various key commodities Nutrien produces. If we see better commodity prices take hold over the long-term (which I think is a very likely scenario), Nutrien’s stock could benefit greatly.
This is a company that is unfortunately held hostage in some ways to commodity prices, so investors will need to put their long-term hats on and see past the next few years toward the longer-term where rising food demand will require a sell-down in the stockpiles of fertilizers and nutrient commodities.
The good thing for Nutrien shareholders who may be bearish on the commodities portion of this company’s business is that Nutrien’s actual exposure to commodity prices is limited. This is due to the company’s portfolio of farm supply stores and sales of non-commodity related goods which came as a result of the Agrium-Potash Corp. merger a while back. This business provides higher margins, increased diversification, and profitability even in the worst of times, giving investors a safety blanket of sorts.
Invest wisely, my friends.
