One of the Best Fertilizer Stocks In Canada (Oct 2022) In 2020, about one in ten people in the world were undernourished.
Canada is among the safest countries when it comes to food security. It’s almost self-reliant and mainly imports processed foods from the US.
Canada might be safe, but global food scarcity is a growing problem.
Key players in the food supply chain, like fertilizer companies, may benefit from this situation, so investing in the best fertilizer stocks in Canada now might be a good long-term strategy.
Fertilizer Stocks In Canada – What Do You Need To Know?
The first thing you need to know about Canada is that it’s not among the top food producers in the world. The top four agricultural producers are among the most populated countries in the world.
Since Canada is currently only supporting a population of 38 million, agricultural production is not on par with more populated countries.
But Canada is also among the largest agri-food exporters in the world, and crops make up a significant portion of these exports.
So the local fertilizer industry is significant for a country with a population of about 38 million, but there is only one giant, i.e., the only large-cap fertilizer stock in Canada. Most other fertilizer stocks are mid- to nano-cap.
Itafos Stock
Ticker: IFOS.V
Industry Niche: Phosphate and specialty fertilizer
Forward Dividend Yield: N/A
Market Cap: $362.44 Million
Forward P/E Ratio: 3.49
Average Analyst Rating: 1.0 - Strong Buy
Like potassium (from potash), phosphorus is a vital fertilizer ingredient that facilitates seed and root growth. And the US-based Itafos is a phosphorus-focused fertilizer company.
Four of its five main projects focus on phosphorus mining and fertilizer production and are located in the US, Brazil, and Guinea-Bissau.
The geographic diversification of its assets is a major plus for the company. It also gives it access to different markets (that can ship directly).
The company used to be significantly more extensive, and the stock used to trade in the early three digits, but now it’s down to a single-digit price tag, but being a penny stock has its perks.
The stock has spiked multiple times in the last five years alone, and the most significant growth in that period was between Dec 2020 and Apr 2022, which pushed the stock up 1,400%.
If you buy the dip and the stock keeps performing the same way, you can expect market-beating returns in relatively shorter time frames.