* Please note that this post was revised on Friday March 25th to include an exact quote from Joe Terranova and also to include information provided by Intrepid Potash refuting Terranova's statement.
With Monsanto, Potash, and Agrium all losing ground over the past month, are fertilizer stocks a value trade or trap?
The question gets a little more complicated when you look at their performance over the past year.
In that time frame they've all doubled the performance of the S&P. Take a look:
Ferts. 1-yr. Performance
What should you make of it?
Joe Terranova feels the space is very volatile and suggests investors pick and choose. He likes Potash, but not IPI "a little bit too much debt there," Terranova says. He’s also bullish Bunge. However he counsels “steer clear of the high fliers.”
As mentioned above we were subsequently contacted by Martin D. Litt, Intrepid Potash executive V.P. and general counsel who tells us Terranova's statement about Intrepid Potash was inaccurate. Litt says "IPI has $0 debt, cash and investments of $143 million, and availability under its credit line of $125 million." He cites IPI’sForm 10-K, filed with the SEC on February 24.
Guy Adami suggests putting Deere on the radar. He thinks it’s “making a push up toward $100.”
Steve Cortes is bearish. He’s short the DBA in anticipation of demand destruction.
Tim Seymour thinks if you want to play the farm trade, play it long wheat.