If you thought maybe you had missed the potash boom, or if you had thought Potash Corp. was expensive at $180/share, it’s worth taking another look. According to research at Canaccord Adams, Potash Corporation of Saskatchewan is still well-set to yet again double its market cap! Keith Carpenter actually gives POT a 12- month target of $425/share.
It’s not that hard to imagine potash being worth as much as Google.
Saskatchewan is the world’s single biggest producer of potash, and the Potash Corporation of Saskatchewan is the single biggest producer in Saskatchewan.
Currently, POT is trading around $184, having come off quite nicely from its highs this year at $246. This could be a good buying opportunity if you like POT and have been watching it from the sidelines. It’s still a bit expensive for my tastes, but I do like that it pays a meagre dividend at 0.2%. That said, I will be watching it in case it comes down a bit further. I think $160 would be a nice price to buy in at, but I’m not sure we’ll see that.
Potash demand isn’t going to be decreasing, either. Just like oil, it’ll be back up with all the production and agriculture needs in China. For other ideas on investing in potash, read the article I wrote last month on junior Canadian potash plays. Also take a look at Raytec and Migao. And of course, subscribe to my free feed for all future updates and leave a comment below with your take on the potash industry.
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