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AGRIUM INC T.AGU

"With more than 1,400 retail centers, Canada-based Agrium is the largest agricultural retailer in the United States, selling fertilizers, crop chemicals, and seed directly to farm customers. The company's wholesale business produces and markets the three main crop nutrients--nitrogen, potash, and phosphate--with natural resources located mainly in Canada and the United States. The bulk of Agrium's sales are generated in the U.S., Canada, and Australia."


TSX:AGU - Post by User

Bullboard Posts
Comment by CLLISNOGOODon Aug 11, 2008 5:29pm
379 Views
Post# 15374848

RE: Will AGU and POT take different paths?

RE: Will AGU and POT take different paths?Good research, however you are attempting to compare them with the assumption that the commodities they produce are equals.  One can see this is not so when you factor in the actual potash - commodity component of each companies current and future sales commitments.  While AGU does supply Potash, it's percentage of total sales is relatively small.  What gives POT the premium P/E is the Potash component being its main product.  Agrium relies more heavily on Nitrogen and Phosphates than does PCS.  The comparison you are making could be best summed up as comparing Natural Gas to Oil.  Both are for energy, but the pricing mechanisms are different (as are the margins).

That being said, AGU does present an attractive potential return, but it will never move upwards independantly of Potash Corp (PCS)
Bullboard Posts