Revolutionizing Agriculture: Technology in Modern Farming
The farmland and agriculture sector is crucial for global food security and economic stability. As the world population continues to grow, the demand for food increases, necessitating innovative practices in agriculture and farming. Recent trends indicate a significant shift towards technology-driven agriculture, which aims to enhance productivity while promoting sustainability.
In the first quarter of 2024, McKinsey surveyed around 4,400 farmers across Europe, India, Latin America, and North America to understand the factors influencing their profitability and technology adoption. The firm conducted a similar survey in 2022. The findings indicate that while farmers are increasingly adopting technology, the pace remains slow, with a three-percentage-point rise since 2022 in those using or willing to use at least one new digital tool to improve operations.
North American farmers lead in technology adoption. In the US, 61% of farmers are using or willing to adopt digital agronomy. Additionally, 51% are using or willing to adopt precision agriculture hardware, and 38% are adopting remote-sensing technologies. Latin America showed the most significant growth in technology adoption, with a remarkable ten-percentage-point increase from 2022 to 2024. Farmers around the world are more inclined to adopt new technologies that directly improve operations. According to the data, digital agronomy and precision agriculture hardware are the most popular technologies around the world.
The survey highlights that in the US, larger farms are 45% more likely to adopt agricultural technology compared to smaller farms. This trend can be attributed to the greater scale needed for a favorable return on investment (ROI) in agtech. Despite the challenges posed by rising input costs and extreme weather conditions, farmers are looking towards sustainable practices and innovative technologies to enhance their productivity and profitability. Organizations that provide technology and services have a unique opportunity to cater to farmers’ diverse needs across different regions.
Our Methodology
To compile our list of the 13 best farmland and agriculture stocks to invest in according to hedge funds, we used the Finviz and Yahoo stock screeners to find the largest farmland and agriculture companies. We also reviewed our own rankings and consulted various online resources.
From an initial pool of more than 30 farmland and agriculture stocks, we focused on the top 13 stocks most favored by institutional investors. Data for the hedge fund sentiment surrounding each stock was taken from Insider Monkey’s Q3 2024 database of 900 elite hedge funds. The 13 best farmland and agriculture stocks to invest in are ranked in ascending order based on the number of hedge funds holding stakes in them, as of Q3 2024.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Is Tyson Foods Inc. (TSN) The Best Farmland and Agriculture Stock To Invest In According to Hedge Funds?
A farmer in a field, bringing in the harvest of live fed cattle for the company.
Tyson Foods Inc. (NYSE:TSN) is an American multinational food corporation that ranks among the best farmland and agriculture stocks to invest in. The company works closely with independent livestock and poultry farmers and owns well-known brands such as Tyson, Jimmy Dean, Hillshire Farm, Ball Park, Wright, Aidells, and State Fair.
In the fourth quarter of 2024, Tyson Foods Inc. (NYSE:TSN) reported sales of $13.56 billion, marking a 1.6% increase from the previous year. The company’s GAAP operating income surged to $525 million, a remarkable turnaround from a loss of $463 million in the same quarter last year. Adjusted operating income also rose significantly to $512 million, reflecting a 117% increase compared to the prior year.
Tyson Foods Inc. (NYSE:TSN) is focused on enhancing its operational excellence by modernizing its processes and leveraging technology. The company plans to invest in digital capabilities, using big data and artificial intelligence (AI) to improve decision-making and customer engagement. This strategic focus on innovation helps Tyson Foods Inc. (NYSE:TSN) expand its market reach and better serve consumers.
Furthermore, Tyson Foods Inc. (NYSE:TSN) has maintained strong liquidity, with approximately $4 billion available as of September 28, 2024. This financial strength allows the company to invest in growth opportunities.
With its robust financial performance, commitment to innovation, and strong market position, Tyson Foods Inc. (NYSE:TSN) stands out as an attractive investment opportunity. According to Insider Monkey’s database, TSN has gained significant interest from institutional investors, with the number of hedge fund holders increasing to 37 in Q3 2024, up from 27 in the previous quarter.
Overall, TSN ranks 4th on our list of the best farmland and agriculture stocks to invest in according to hedge funds. While we acknowledge the potential of TSN as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than TSN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
