Agriculture stocks: 4 Agriculture Stocks to Feed Your Need for Gains
The Crop protection products segment saw sales increase by 17% year over year. Around 30% or more of the production of the world’s key food crops is located in regions of high to extremely high water stress, a figure that is set to increase in the future. This article from last year further explores the risk posed by water scarcity to portfolios. See the best agriculture stocks to buy now, according to analyst forecasts for the farm & heavy construction machinery industry. Prices of primary crops like corn, soybean, and wheat have been accelerating due to the Russia-Ukraine war, weather constraints, and supply chain bottlenecks.
In terms of products, FMC’s portfolio skews toward insecticides, which account for over 60% of its revenue. The remainder are herbicides (~25%), as well as fungicides and other crop chemicals (~15%). Companies focused on plant-based products may benefit by creating partnerships and supply agreements with larger agriculture companies such as Archer-Daniels-Midland, Bunge, and Tyson Foods. Fertilizer prices soared in 2021 as raw material costs increased for nitrogen fertilizers and demand also rose, leading to a boom year for producers such as Nutrien. Prices for fertilizers such as nitrogen and potash spiked even higher after Russia invaded Ukraine; both countries are major fertilizer producers.
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It operates in North America, Latin America, Europe, the Middle East, Africa, and Asia. The Scotts Miracle-Gro Company is one of the world’s leading marketers of branded consumer lawn and garden as well as hydroponic and indoor growing products. The company offers fertilizers, grass seed products, spreaders, outdoor cleaners, and any lawn-related weed, pest, and disease control products.
The Dividend Achievers List is comprised of ~350 stocks with 10+ years of consecutive dividend increases. At Sure Dividend, we often advocate for investing in companies with a high probability of increasing their dividends each and every year. The company provides over 20% of the global market on potash, 3% nitrogen, and 3% phosphate. The Toro Company was founded in 1914 as an engine manufacturer, providing power to early tractors. The company quickly shifted focus to mowers and in the century since, it has grown to $4.5 billion in annual revenue. Toro operates in North America as well as internationally, with three quarters of total revenue coming from the U.S.
Top 8 agriculture stocks to invest in 2023
Addressing emissions from the broader value chain will be more challenging. Food production is responsible for around one fourth of the world’s greenhouse gas emissions—the driving force behind global warming and climate change. Most of these emissions are generated at the farm level, as a result of livestock rearing or fertilizer application . As a result, companies are taking initiatives to decrease costs, increase their revenue by building more facilities, and improve their system’s costs. The average P/E ratio of the farm & heavy construction machinery industry is 15.6x. Nutrien Ltd. is a Canadian company formed through Agrium and PotashCorp’s merger in a closed transaction on January 1, 2018.
Food companies that are well-positioned to respond to growing demand by effectively managing their direct and supply chain exposure to environmental and social concerns. One such name is Barry Callebaut BARN. It is ranked by Morningstar Sustainalytics as number one out of 359 companies in the broad packaged-foods subindustry, with an attractive valuation to sweeten the deal. Agriculture already takes up 50% of all habitable land, and its rapid expansion has been a major contributor to biodiversity loss, water scarcity, and global warming. In order to limit the need for further land conversion, it will be instrumental to boost crop yields to achieve more with existing croplands. At the same time, environmentally friendly agricultural practices will be essential to support the quality and fertility of soils.
Consumer discretionary is an economic sector comprising non-essential products and services that individuals may only purchase when they have excess cash. One focus is engineering high-protein, neutral-tasting chickpeas, which could become a next-generation, plant-based protein source. Beyond Meat relies on yellow pea protein for its products, but it might be tempted to switch at least some supply to chickpeas if the Precision product lives up to the hype. Pesticides have also seen a spike in prices due to supply chain constraints and material shortages. A wave of consolidations in recent years is also reshaping the industry.
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Adjusted EPS also saw a 15% growth to $7.45, while the company also distributed $288 million in the form of dividends and share repurchases. The company reported revenue of $1.38 billion, an increase of 15% versus the third quarter of 2021, and adjusted earnings per diluted share of $1.23, down 14% versus the same quarter the previous year. FMC Corporation is an agricultural sciences company that provides crop protection, plant health, and professional pest and turf management products. Through acquisitions, FMC is now one of the five largest patented crop chemical companies. Even better, all 7 agriculture stocks pay dividends to shareholders, making them attractive for income investors. Interested investors should view this as a starting off point to more research.
Agriculture Stock #6: FMC Corporation (FMC)
It’s also worth noting that as of September 2019, the market value of the company’s farmland was $766 million. That said, it’s very likely that farmland value will increase in the coming years. This provides another avenue for the company to deliver shareholder value by monetizing assets. Therefore, considering the value of the company’s key asset, Adecoagro is not over leveraged.
While we expect no EPS growth, the 2.5% dividend yield and 11.5% annual returns from an expanding P/E multiple will fuel future returns. Archer-Daniels-Midland is the largest publicly traded farmland product company in the United States. Its businesses include processing cereal grains, oil seeds, and agricultural storage and transportation. The company is currently being pressured by higher commodity prices that have led to a significant margin decline despite multiple pricing actions.
Bayer acquired Monsanto in 2018 to become the dominant player in the industry. DuPont and Dow Chemical merged and then split into three separate companies in 2019, with one being Corteva Agriscience. ScottsMiracle-Gro offers exposure to individual consumers such as gardeners and homeowners in need of lawn care products, as well as farmers. The stock did well during the early stages of the COVID-19 pandemic as stay-at-home orders and a general shift to more time spent outdoors sparked an interest in lawn and garden care.
FMC has transformed itself to solely focus on crop chemicals, having acquired DuPont’s crop chemicals portfolio in 2017, and completed the separation of its lithium business in 2019. FMC is now one of the largest patented crop protection companies globally. Another benefit from this sector is that farmland real estate investment trusts and certain agriculture stocks can provide passive income through regular dividend payouts.
And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data. Agriculture stocks were down -0.53% in the last day, and down -0.14% over the last week. The High Yield Dividend Kings List is comprised of the 20 Dividend Kings with the highest current yields. The High Yield Dividend Aristocrats List is comprised of the 20 Dividend Aristocrats with the highest current yields. The company has over 1,700 retail locations in North America, South America, and Australia and is one of the world’s largest manufacturers and suppliers of potash, nitrogen, and phosphate. Management presented a “strategy for growth” plan with an adjusted EBITDA between $375 – $400 million in 2025.
Corteva is another undervalued seed and crop chemical producer, set to benefit from the wider adoption of genetically modified seeds, on top of its own ambition on biologicals. The company expects 25% of its crop protection revenue to be generated by biologicals by 2035, compared with roughly 12% in 2022. For agricultural companies further along the value chain, tackling greenhouse gas emissions is likely to be primarily focused on direct operations and purchased electricity .
Of the 12 analysts covering Terex, 33.33% have issued a Strong Buy rating, 0% have issued a Buy, 66.67% have issued a hold, while 0% have issued a Sell rating, and 0% have issued a Strong Sell. Agco stock has a consensus Buy recommendation according to Wall Street analysts. Of the 8 analysts covering Agco, 37.5% have issued a Strong Buy rating, 12.5% have issued a Buy, 50% have issued a hold, while 0% have issued a Sell rating, and 0% have issued a Strong Sell.
