SPECIAL REPORT The Top 7 Stocks for 2024

The Future of Farming: 3 AgriTech Stocks to Grow Substantial Profits

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  • These AgriTech stocks are poised for substantial growth in a market driven by precision farming and digital innovations.
  • Trimble (TRMB): Boasting an 8% revenue increase and an anticipated 2023 revenue of up to $3.8 billion, Trimble signals a strong growth trajectory.
  • Deere (DE): With a 12% sales increase and a 58% net income surge, Deere’s ExactShot technology and projected sales growth in agricultural equipment underline its solid market position.
  • Nutrien (NTR): As the leading potash producer with $5.37 billion in revenue and a 3.75% forward yield, Nutrien’s growth and eco-friendly projects underscore its strong position.
AgriTech stocks - The Future of Farming: 3 AgriTech Stocks to Grow Substantial Profits

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The rapidly evolving AgriTech sector, driven by the widespread adoption of precision farming and advanced internet-based data management systems, continues to reshape agriculture. That transformation is evident in its anticipated market size, which could surpass a remarkable $75.87 billion by 2032, expanding at a rapid 13.1%. The growth trajectory places AgriTech stocks in the spotlight, attracting significant investor interest.

Central to this burgeoning market is the role of rapid digitalization in agriculture, enhancing connectivity among farmers and catalyzing the adoption of advanced technologies. The shift is spurring investments in agricultural biotechnology and building innovative farming systems, driven by the growing presence of AgriTech companies and a focus on sensor technologies.

The trend is further fueled by technological innovations like Deere’s (NYSE:DE) fully autonomous tractor. Developed after extensive real-farm testing, such advancements are not just futuristic concepts, but present-day realities driving the sector forward and reaping the rewards in the process.

Trimble (TRMB)

The Trimble (TRMB) headquarters in Sunnyvale, California.
Source: Tada Images / Shutterstock.com

Trimble (NASDAQ:TRMB), a leader in precision farming, is making significant strides in the tech world. With its recent joint venture with AGCO (NYSE:AGCO), the partnership is expected to generate a robust $3 billion in value, reflecting Trimble’s growing influence and financial prowess.

Moreover, Trimble is shaking up agricultural data management with its new Trimble Agriculture Software-Data user license, turbocharging farmers’ ability to handle precision agricultural data efficiently. In a parallel tech leap, the company’s integration with Microsoft 365 and BIMcollab is transforming project management in its niche, which should lead to more effective streamlining of workflows and supercharging real-time data sharing.

Financially, Trimble recorded a tremendous revenue bump to $957 million, up 8% year-over-year, and a solid net income of $74.9 million in the third quarter. Anticipating continued growth, Trimble projects a 2023 revenue between $3.75 billion and $3.79 billion. Matching this upbeat outlook, TipRanks analysts foresee a robust 27.6% stock upside, spotlighting Trimble’s dynamic growth and profitability.

Deere (DE)

Several John Deere vehicles are parked outside of a building.
Source: Jim Lambert / Shutterstock.com

Deere is making substantial strides in the AgriTech sector, propelled by rising food prices that have spurred an increase in farming activities. The company recently reported a remarkable 12% increase in sales and a whopping 58% surge in net income year-over-year, reaching a total of $2.98 billion. These figures underscore Deere’s strong financial influence.

Moreover, Deere is at the forefront of tech-agriculture fusion with its ExactShot technology. It is effectively revolutionizing farming, targeting areas precisely and potentially slashing fertilizer costs by 60%. Additionally, Deere anticipates a robust 10% rise in sales of large agricultural equipment in the U.S. and Canada in fiscal 2023, mirroring the impressive demand in this sector.

Furthermore, analysts at TipRanks are optimistic about Deere’s prospects, giving it a Moderate Buy rating with a potential 18% upside. Additionally, with an attractive dividend yield of 1.32% and trading at an appealing 1.96 times forward sales estimates, Deere represents a compelling investment opportunity.

Nutrien (NTR)

A photo of Nutrien's (NTR) website, with a magnifying glass over the logo.
Source: Pavel Kapysh/ShutterStock.com

Nutrien (NYSE:NTR), a Canadian powerhouse in the fertilizer industry, stands as the world’s largest producer of potash and the third largest in nitrogen fertilizer. Boasting over 2,000 retail locations across North America, South America and Australia, Nutrien stands as both a manufacturing behemoth and a frontrunner in cutting-edge agricultural technologies.

Strategically expanding, Nutrien is set to boost its annual potash production to 18 million tonnes by 2025, aiming to address global supply gaps and burgeoning demands. Simultaneously, it is diving headfirst into sustainability, venturing to construct the world’s largest clean ammonia facility in Louisiana, a testament to its commitment to eco-friendly practices and plans for carbon capture advancement.

Furthermore, Nutrien surged with an impressive $1.1 billion adjusted EBITDA, totaling $5 billion over nine months. The company’s revenue hit a high of $5.37 billion, with a forward yield of 3.75%, showcasing steady profitability. Concurrently, a Moderate Buy rating from TipRanks analysts predicting a 32% upside potential demonstrates the stock’s potential in the global fertilizer market.

On the date of publication, Muslim Farooque did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.


Article printed from InvestorPlace Media, https://investorplace.com/2023/11/the-future-of-farming-3-agritech-stocks-to-grow-substantial-profits/.

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