Mizuho cuts Nutrien stock price target on reduced earnings outlook By Investing.com

Tuesday, Mizuho Securities adjusted its outlook on Nutrien Ltd (NYSE: NYSE:), reducing the stock’s price target to $55.00 from $59.00, while maintaining a Neutral rating. The revision reflects expectations that global potash prices will likely decline due to lower contract prices in China and India.

The firm anticipates Nutrien to report second-quarter earnings before interest, taxes, depreciation, and amortization (EBITDA) and earnings per share (EPS) at $2.24 billion and $2.16, respectively. These figures are slightly above the consensus estimates of $2.22 billion for EBITDA and just below the $2.21 consensus for EPS.

The firm has also adjusted its 2024 earnings forecast for Nutrien, trimming the EBITDA estimate to $5.60 billion from $5.72 billion, which is a decrease of approximately 2%. The EPS forecast has been lowered more significantly, by roughly 5%, moving from $4.00 to $3.82. This revised EPS estimate is notably lower than the consensus of $3.90.

The rationale behind the price target reduction is attributed to the anticipated decreased earnings and the ongoing challenges within the agricultural sector, which are expected to continue impacting investor sentiment towards agricultural stocks. The firm’s analysis suggests that these industry headwinds will play a significant role in shaping the market’s view of Nutrien’s financial performance.

The updated figures and price target from Mizuho Securities provide investors with a revised perspective on Nutrien’s potential financial trajectory in the coming quarters, especially considering the broader challenges faced by the agriculture sector.

In other recent news, Nutrien Ltd. reported a $1.1 billion adjusted EBITDA in Q1 of 2024, despite lower prices for key products such as potash, nitrogen, and phosphate. The company has also outlined its growth strategy and performance targets, aiming to control costs and increase efficiency. Nutrien plans to reduce costs by approximately $200 million by 2026 across operations and corporate functions.

Analyst firm Jefferies has adjusted its outlook on Nutrien, reducing its price target to $62 from $71, reflecting a more cautious stance for H2 of 2024. However, the firm maintained its Buy rating on the company’s stock. UBS also maintained its Buy rating on Nutrien shares, reiterating a $67 price target.

Piper Sandler, on the other hand, maintained an “Underweight” rating due to potential challenges from an anticipated large crop. RBC Capital Markets maintained an “Outperform” rating, indicating confidence in Nutrien’s operational efficiency and improved cash generation.

These recent developments offer potential investors a deeper understanding of the company’s current position and prospects.

InvestingPro Insights

As Nutrien Ltd (NYSE: NTR) navigates through a shifting fertilizer market, key financial metrics and insights from InvestingPro provide a deeper understanding of the company’s position. With a market capitalization of $24.72 billion and a current P/E ratio of 29.16, Nutrien shows a significant presence in the chemicals industry. Its adjusted P/E ratio for the last twelve months as of Q1 2024 stands at 17.37, reflecting market expectations of its earning potential.

InvestingPro Tips highlight that Nutrien has a history of rewarding shareholders, having raised its dividend for 6 consecutive years, and currently offers a dividend yield of 4.32%. Additionally, the company is trading near its 52-week low, which could present a buying opportunity for value investors. Analysts predict Nutrien will remain profitable this year, supported by a strong free cash flow yield, as suggested by its valuation.

Investors considering Nutrien’s stock can find further insights and tips on InvestingPro, including a total of 9 additional InvestingPro Tips that can help in making a more informed decision. For those interested in a deeper analysis, use coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription at https://www.investing.com/pro/NTR.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.