5 Best Farmland and Agriculture Stocks To Buy According to Hedge Funds

In this article, we discuss the 5 best farmland and agriculture stocks to buy according to hedge funds. To read the detailed analysis of the farmland and agriculture industry, go directly to the 12 Best Farmland and Agriculture Stocks To Buy According to Hedge Funds.

5. Nutrien Ltd. (NYSE:NTR)

Number of Hedge Fund Holders: 39

Nutrien Ltd. (NYSE:NTR) is a Canadian company that provides crop inputs and related services. Through its Nutrien Ag Solutions, the company offers various agricultural solutions, including crop protection products, nutrients, and more. As of March 21, the company has a market cap of $26.518 billion.

Nutrien Ltd. (NYSE:NTR) is among the best farmland and agriculture stocks to buy, as the company announced an increase in its quarterly dividend of 1.9% to $0.54 per share on February 21. The dividend is payable by April 11 to the shareholders of record on March 28. As of March 21, the stock’s dividend yield is 4.03%.

According to Insider Monkey’s database, which tracks 933 elite hedge funds, 39 institutional investors held positions in Nutrien Ltd.’s (NYSE:NTR) stock in the fourth quarter of 2023 with positions worth $483.969 million. As of December 31, 2023, Jean-Marie Eveillard’s First Eagle Investment Management has a position worth $536.312 million in the stock and is the biggest shareholder in the company.

On February 21, Nutrien Ltd. (NYSE:NTR) reported earnings for the fiscal fourth quarter of 2023. The company reported non-GAAP earnings per share of $0.37. In the quarter, the revenue amounted to $5.66 billion and outperformed the estimates by $460 million.

4. The Mosaic Company (NYSE:MOS)

Number of Hedge Fund Holders: 43

The Mosaic Company (NYSE:MOS) is a Florida-based producer and marketer of concentrated phosphate and potash crop nutrients. The company owns seven potash and phosphate mining facilities and five phosphate concentrate sites in North America. In South America, the company owns thirteen facilities, seven tolls, one port terminal, and 6.6 million tons of blending capacity.

Based on 5 Wall Street analysts’ consensus ratings over the last three months, The Mosaic Company (NYSE:MOS) has a Moderate Buy rating. As of the March 21 market close, the average price target of $38.25 implies an upside of nearly 20% from the current levels.

In the fourth quarter of 2023, hedge fund sentiment was positive toward The Mosaic Company (NYSE:MOS) as 43 hedge funds had investments in the stock with positions worth $565.181 million. This is compared to 35 funds in the preceding quarter with a total stake value of $396.452 million. As of December 31, 2023, AQR Capital Management owns 3.237 million company shares worth $115.67 million in the company and is the most dominant shareholder.

The Mosaic Company (NYSE:MOS) was mentioned in White Brook Capital Partners’ fourth-quarter 2023 investor letter:

“The Mosaic Company (NYSE:MOS) and Green Plains (GPRE), our commodity-sensitive investments, remain substantial positions in the portfolio. The companies are a natural hedge to each other in some ways, as the price of corn is a feedstock for Green Plains while it bolsters the purchasing power of Mosaic’s customers. On the other hand, higher oil prices are a positive for Green Plains, while the opposite is true for Mosaic.

The Mosaic thesis didn’t change during 2023. The world’s potash and phosphate needs grow at a ~2% CAGR, and the price for potash and phosphate, which declined from Covid peaks during 2023, is likely to be at least stable in 2024. Mosaic continues to generate substantial free cash flow on a business with lessening capital intensity, and the balance sheet has a very manageable debt load. The Company’s CEO, Jack O’Roarke, announced his retirement at the end of 2023, but I expect the company to go from strength to strength as long-time heir apparent Bruce Bodine leads the company in 2024. I believe the company will continue to return capital to shareholders through enhanced stock buybacks while investing in high-return brownfield opportunities that will continue to grow long-term free cash flow per share. Additionally, should battery manufacturers adopt more phosphate in their batteries as Tesla and Ford have begun to do, it could significantly change the demand dynamics of one of its two products and ensure Mosaic’s significant cash flows years into the future.”

3. Caterpillar Inc. (NYSE:CAT)

Number of Hedge Fund Holders: 48

Caterpillar Inc. (NYSE:CAT) is a Texas-based company that manufactures and sells a variety of agriculture equipment, including skid steer loaders, mini excavators, telehandlers, and more. The company has a market cap of $182.053 billion and a PE ratio of 18.14 as of March 21.

Caterpillar Inc. (NYSE:CAT) was part of 48 hedge funds’ portfolios in Q4 2023, and their stakes amounted to $5.467 billion. Billionaire Ken Fisher’s Fisher Asset Management has a position worth $2.406 billion in the company and is the largest shareholder, as of Q4 of 2023.

Caterpillar Inc. (NYSE:CAT) is one of the top farmland and agriculture stocks to buy as Wall Street is positive on the stock. On March 13, Truist initiated coverage of the stock with a Buy rating and a $390 price target.

Diamond Hill Capital made the following comment about Caterpillar Inc. (NYSE:CAT) in its Q3 2023 investor letter:

“Caterpillar Inc. (NYSE:CAT), the world’s leading manufacturer of construction and mining equipment, also performed well this quarter. Caterpillar has managed to leverage increased capital investment from various end markets, contributing to better than expected fiscal results for Q2. The company is poised to be one of the largest beneficiaries of several government funding initiatives, including the IRA (Inflation Reduction Act) bill, CHIPS Act and infrastructure bill. These measures are expected to support construction spending for several years, providing a robust backdrop for Caterpillar’s continued growth.”

2. Corteva, Inc. (NYSE:CTVA)

Number of Hedge Fund Holders: 51

Corteva, Inc. (NYSE:CTVA) is a chemical and seed company that offers its products through its two segments, Seed and Crop Protection. The company provides its products in more than 125 countries and caters to over 10 million customers.

Corteva, Inc. (NYSE:CTVA) has a consensus Strong Buy opinion based on the ratings by 15 Wall Street analysts over the last three months. The stock has an average price target of $61.61 and a high forecast of $67.00 as of the March 21 market close. The average price target implies an upside of 10.45% from the last price of $55.78 as of March 21.

Corteva, Inc. (NYSE:CTVA) was held by 51 hedge funds in the fourth quarter of 2023, and their positions were worth $1.208 billion. This is compared to 42 funds in the prior quarter with a total stake of $871.072 million. Harris Associates is the most significant shareholder in the company as of December 31, 2023, and has a position worth nearly $431.841 million.

Aristotle Capital Management, LLC stated the following regarding Corteva, Inc. (NYSE:CTVA) in its fourth quarter 2023 investor letter:

“Corteva, Inc. (NYSE:CTVA), the seed and crop protection company, was the largest detractor during the quarter. Following robust orders during the 2020-2022 period, customer destocking persisted throughout 2023, particularly in Brazil, causing Corteva to lower 2023 revenue and profit guidance to -2% and -3% year-over-year, respectively. While the crop protection business appears to be, in our view, at or near a cyclical bottom, the seed business remained resilient, with +14% year-over-year price/mix effects more than offsetting the 12% fall in volumes during the third quarter. We are encouraged by management’s actions, including further optimization of the crop protection business and Corteva’s FREE cash flow generation during this challenging period. Despite cyclical headwinds, the company continues to execute on catalysts we previously identified, including margin expansion via improved pricing and product mix, as well as reduced royalty expenses.”

1. Deere & Company (NYSE:DE)

Number of Hedge Fund Holders: 54

Deere & Company (NYSE:DE) is a manufacturer of farm machinery and industrial equipment that serves grain growers, dairy and livestock producers, crop producers, and others. With a market cap of $110.686 billion, Deere & Company (NYSE:DE) is a known name in the agriculture industry due to its signature products like 4WD/track tractors, precision agriculture technology, and more.

Deere & Company (NYSE:DE) tops our list of the best farmland and agriculture stocks to buy according to hedge funds, as it was part of 54 funds’ portfolios in Q4 of 2023, and their stakes amounted to $4.38 billion. Of those, the Bill & Melinda Gates Foundation Trust is the top shareholder in the company and has a position worth $1.422 billion.

Wall Street is bullish on Deere & Company (NYSE:DE) as Truist analyst Jamie Cook initiated coverage of the stock with a Buy rating and a $494 price target on March 14. Over the past three months, the stock has received Buy-equivalent ratings from 11 Wall Street analysts. The average price target of $425.00 has an upside of 6.88% from the present levels as of March 21.

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