How to Kill a Groundhog
Fertilizer Stocks
CF Industries and Agrium
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Thanks to a mild spring, the crops came in early this year in New England, and they’ve grown big.
My 10 tall blueberry bushes have been bearing fruit for over a month now, and I’ve been able to freeze a lot of the berries I pick, even after consuming them on a daily basis and giving some away.
And until last week I was congratulating myself on a netting job so perfect that no birds had penetrated it—a first in the 20 years I’ve been doing this.
Then came the morning when I discovered that both a squirrel and a rabbit had found an entrance route down low. I shooed them out the door, plugged the hole haphazardly, and got on with my picking.
The next morning, there were four squirrels in there!
So I got serious and plugged the hole properly, giving thanks once again that I don’t try to make a living by farming.
It’s not just blueberries that are thriving, of course; everything from lettuce to peas is off to a great start. Even the weeds are championship quality. And the critters that feed on the greens, from rabbits to groundhogs, are prolific, too.
Which brings me to my dog, Layla, now nine years old.
She’s wonderful with children, and she’s been taught not to bother the chickens and guinea hens on the farm.
But she’s a natural at killing groundhogs, and that’s fine by me.
Here’s a picture.
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Speaking of farming, fertilizer stocks have been doing well this year. The reasons? Drought, rapidly rising prices for corn, and a growing global population. Two of the best stocks recently earned mention in Cabot Top Ten Trader.
First was CF Industries (CF) on July 9, which said, “When fertilizer giant CF Industries was first featured in Cabot Top Ten Trader in early 2007, the big news was low wheat inventories caused by droughts and demand for corn to make ethanol. Today, the demand for corn ethanol remains constant, but the big news is that record heat in the midwestern U.S. is threatening corn crops. And the constant factor in the background is still a growing world population that needs feeding. CF Industries manufactures and sells nitrogen and phosphate fertilizers: 85% are sold in the U.S., 8% in Canada and 7% are exported. CF Industries is the second largest nitrogen fertilizer producer in the world, a result of its acquisition of Terra Industries in 2010. With a consistent and growing position in North American fertilizer production and distribution, the way is clear for CF Industries to make headway overseas. The company will report Q2 results in early August.”
Readers who got on board in the days after that issue are off to a good start.
A week later, Cabot Top Ten Trader featured Agrium (AGU), writing, “The story on fertilizer manufacturer Agrium is very similar to that of CF Industries. Agrium makes nitrogen, potash and phosphate-based fertilizers and other agricultural products, 88% of which are distributed in North America. Recent droughts have created shortfalls in crop production, and that has raised the price of agricultural commodities. So farmers are encouraged to buy more fertilizer to try to take advantage of the situation. The company recently announced that its Q2 results would be near the top of its guidance, as strong demand is keeping prices high for many products. Agrium had a 44% increase in revenue in 2011, and is growing both in its home country of Canada and internationally. In March, it was announced that Agrium will acquire 90% of Viterra’s Canadian operations and all of its Australian retail facilities in a deal with Glencore, the company that is acquiring Viterra. Investors are encouraged that Monsanto has already released strong quarterly results, and a good report from Agrium would give the stock another boost.”
Readers who bought after that recommendation are off to a good start, too.
Today, moving in sync with the broad market, both CF and AGU have pulled back from last week’s highs. Their pullbacks could last longer. But the main trends remain up, and we remain bullish on both stocks, so you could buy here.
Smarter, though, is to take a no-risk trial subscription to Cabot Top Ten Trader so you can see what editor Mike Cintolo is recommending now.
Yours in pursuit of wisdom and wealth,
Timothy Lutts
Editor of Cabot Stock of the Month
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