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Raymond (NSE:RYMD) James downgraded Nutrien Ltd. (NYSE:NTR), a $30.6 billion market cap chemicals company, from Outperform to Market Perform on Tuesday, maintaining a price target of $68.00. According to InvestingPro data, the stock currently trades near its 52-week high of $65.08, with analysts’ targets ranging from $53 to $70.
The research firm cited Nutrien’s significant year-to-date share price gains of 40.4%, which substantially outpaced the TSX’s 7.4% increase over the same period, resulting in "diminishing commensurate upside" to their target. The company maintains a 3.47% dividend yield and has raised its dividend for seven consecutive years, as highlighted in InvestingPro’s analysis.
While recent settlements of potash contracts with China and India likely support additional spot momentum, Raymond James noted that key benchmarks have already staged strong moves since their December 2024 upgrade, with prices up 25% in Brazil, 17% in Southeast Asia, and 19% in the U.S. Midwest.
The firm expressed concern about a "clear decoupling" between Nutrien’s share performance and corn prices, which have retreated 13.6% from their February 2025 highs while Nutrien shares gained 18.2% during the same period—a dynamic Raymond James described as "rarely proven sustainable."
Despite continuing to "admire management’s solid progress toward its long-term objectives," the research firm determined it was "prudent to step to the sidelines until a more attractive entry point emerges."
In other recent news, Nutrien reported first-quarter earnings that fell short of analyst expectations, with adjusted earnings per share at $0.11 compared to the $0.36 consensus estimate. Revenue also missed projections, coming in at $5.1 billion against the expected $5.2 billion. The company’s adjusted EBITDA declined by 19% year-over-year to $852 million, largely due to lower potash prices in North America and weaker retail earnings. Despite these setbacks, Nutrien maintained its full-year 2025 guidance for retail adjusted EBITDA and potash sales volumes.
Analysts have weighed in on Nutrien’s performance, with BofA Securities increasing the stock price target to $63 while maintaining a Buy rating, citing a rise in potash prices and strong demand in the U.S. and Brazil. RBC Capital Markets also raised its price target to $65, highlighting Nutrien’s strong fundamentals and effective strategies. The firm anticipates robust cash flows, estimating around $2 billion annually, which supports dividends, share buybacks, and strategic acquisitions. Both analyst firms express confidence in Nutrien’s ability to navigate the agricultural and fertilizer markets despite the first-quarter earnings miss.
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