), one of the major retail suppliers of agricultural products and
services in North America, announced that it has no plans of
splitting its retail operation. The announcement comes in the wake
of a suggestion to split the company's retail and wholesale
business by hedge fund JANA Partners, as per media reports.
Agrium's board deemed the spin-off to be not in the best interest
of the company and decided to abstain from it. The company also
cited that the spin-off might enhance investors' risk without
really adding any benefit.
Agrium also announced that it will continue pursuing its
business strategy of generating strong results and boosting
shareholders' returns consistently. Two weeks ago, the company
released its second quarter 2012 results.
The company's second-quarter 2012 adjusted (excluding one-time
items other than stock-based compensation expenses) earnings of
$5.43 per share exceeded the Zacks Consensus Estimate of $5.36. On
a reported basis, earnings came in at $5.44 per share, up 19.8%
from $4.54 reported in the year-ago quarter.
Revenues amounted to $6,834 million in the quarter, up 10.3%
year over year and were higher than the Zacks Consensus Estimate of
$6,549 million. The revenue growth was driven by higher
The company expects crop yields to be lower in 2012 owing to
severe droughts in the country, resulting in high grain prices.
High crop prices and tight grain inventories are expected to create
huge demand for nutrients in the years ahead.
The company, which competes with
CF Industries Holdings Inc.
Potash Corp. of Saskatchewan Inc.
), maintains a Zacks #1 Rank, implying a short-term (1 to 3 months)
Strong Buy rating. We currently have a long-term (more than 6
months) Outperform recommendation on its shares.
AGRIUM INC (AGU): Free Stock Analysis Report
CF INDUS HLDGS (CF): Free Stock Analysis Report
POTASH SASK (POT): Free Stock Analysis Report
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