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Nutrien Ltd NTR

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Morningstar’s Analysis

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Reducing Our Nutrien Fair Value on Lower Near-Term Nitrogen Outlook; Shares Remain Undervalued

Seth Goldstein, CFA Senior Equity Analyst

Analyst Note

| Seth Goldstein, CFA |

Nutrien's 2020 results continued to be affected by lower fertilizer prices as total adjusted EBITDA declined 15% year on year due largely to lower potash and nitrogen prices. We've lowered our near-term outlook to incorporate our reduced nitrogen price forecast and higher North American natural gas costs, which are the largest input cost for nitrogen production. We've also reduced our long-term pricing outlook for phosphate, but our forecast for higher long-term potash prices is unchanged.

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Company Profile

Business Description

Created in 2018 as a result of the merger between PotashCorp and Agrium, Nutrien is the world’s largest fertilizer producer by capacity. Nutrien produces the three main crop nutrients--nitrogen, potash, and phosphate--although the company’s main focus is potash, where it is the global leader in installed capacity with roughly 20% share. The company is also the largest agricultural retailer in the United States, selling fertilizers, crop chemicals, seeds, and services directly to farm customers through both its physical stores and online platforms.

Contact
122 - 1st Avenue South, Suite 500
Saskatoon, SK, S7K 7G3, Canada
T +1 306 933-8500
Sector Basic Materials
Industry Agricultural Inputs
Most Recent Earnings Sep 30, 2020
Fiscal Year End Dec 31, 2020
Stock Type
Employees 22,300

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