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Multiple fertilizer makers are climbing today after investment bank Piper Sandler upgraded several names in the space today. Nutrien (NTR) is advancing 4.7%, while CF Industries (CF) is gaining 7% and LSB Industries (LXU) is soaring 22%. Rare Double Upgrades Piper raised its rating on NTR, CF, and LXU by two levels in a note to investors today. Specifically, it upgraded the names to Overweight from Underweight. It's rare for analysts to upgrade stocks from the equivalent of Sell to the equivalent of Buy, skipping over the hold or neutral option. The bank also raised its rating on Mosaic (MOS) to Neutral from Underweight.
Aerial view of a vast open field of grain crops, representative of the company's agricultural commodities. Piper upgraded the shares primarily due to its belief that grain prices will be higher than previously expected. The firm reached that conclusion after reviewing the most recent World Agricultural Supply and Demand Estimates (WASDE) report. Noting that grain and fertilizer prices tend to rise and fall together, Piper predicted that higher grain prices would increase the demand for fertilizer in multiple regions of the world. Another Bank Was Upbeat on the Sector Recently On Jan. 8, another bank, RBC Capital, predicted that farmers' profits would rise this year. "Fertilizer equities provide good cash generation at reasonable valuations and defensive commodity exposure against broader macro risk,” the bank stated. It kept Outperform ratings on CF, NTR and LXU. While we acknowledge the potential of NTR, our conviction lies in the belief that some 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 NTR but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ ALSO 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock Disclosure: None. This article is originally published at Insider Monkey.