Agrium Plays Catch-up on Dividends (AGU, POT, MOS, MON, SYT)

Canadian-based Agrium Inc. (NYSE: AGU) announced this morning that it would raise its semi-annual dividend to $0.50, more than double the previous $0.225 payment. The company’s CEO said:

The further increase in our dividend is an indication of the strength in our earnings outlook across both our Retail and Wholesale operations and how our growth strategy has continued to deliver results for the benefit of shareholders.

At last night’s closing stock price of $78.21, Agrium’s dividend yield is now 1.3%, compared with the 1.6% yield at Monsanto Co. (NYSE: MON), the 1.5% dividend yield at Potash Corp. of Saskatchewan Inc. (NYSE: POT), and the 1.1% paid by The Mosaic Co. (NYSE: MOS). The best dividend yield among the fertilizer makers is 2.4% at Swiss-based Syngenta AG (NYSE: SYT).

Potash Corp. doubled its quarterly dividend to $0.14 in January and Mosaic raised its dividend from $0.05 to $0.125 in April. Monsanto raised its quarterly dividend from $0.28 to $0.30 in August 2011. Syngenta’s current annual dividend is set at 8 Swiss francs/ordinary share, about $2.10 at current exchange rates, was raised in April.

Agrium really had no choice but to follow its competitors, and even to make up for lost ground in dividend payments. Shares are up about 1.3% in pre-market trading at $79.25 in a 52-week range of $60.15-$93.49.

Paul Ausick