AGRIUM INC. $84 - Toronto symbol AGU

AGRIUM INC. $84 (Toronto symbol AGU; Aggressive Growth Portfolio, Resources sector; Shares outstanding: 158.0 million; Market cap: $13.3 billion; Price-to-sales ratio: 0.8; Dividend yield: 1.2%; TSINetwork Rating: Average; www.agrium.com) has raised its semi-annual dividend by 122.2%, to $0.50 a share (all amounts except share price and market cap in U.S. dollars) from $0.225. The new annual rate of $1.00 yields 1.2%.

Meanwhile, some farmers have objected to the company’s $1.65-billion purchase of 232 of Viterra Inc.’s (Toronto symbol VT) 258 retail stores in western Canada, which sell seed, fertilizer and other agricultural products. However, Agrium’s competitors would still control twothirds of this market.
The deal also includes Viterra’s 17 stores in Australia, plus its 34% stake in a fertilizer plant. The deal should close in the next few weeks.
The purchase makes sense for Agrium, as steady revenue streams from these retail stores help shield it from volatile fertilizer prices.
Agrium is a buy.

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