UPDATE: BMO Capital Markets Reiterates Outperform Rating, Lowers PT on Agrium on Adjusted Q4 EPS

In a report published Monday, BMO Capital Markets reiterated its Outperform rating on Agrium

, but lowered its price target from $123.00 to $120.00. BMO Capital Markets noted, “AGU remains rated Outperform, but we lower our target price to $120 from $123. AGU's disproportionate sell-off (reminiscent of the post-Q3 sell-off) stemmed from continuing concerns Jana will exit before the April 9 AGM, amplified by the USDA outlook reiterating the risk (in the market for months) for lower corn prices from large acres assuming trend yields, as well as investors contemplating AGU's relative outperformance over POT, CF and MOS. Pressure on fertilizer stocks from the steep corn futures inverse could continue should optimism on yields not lower, though similar optimism is typically presented by the USDA at this time of the year and needs to be properly assessed. We prefer fertilizer stocks with bullets to help offset corn price concerns: improving capital return/FCF yields, incremental potash shipment growth potential and leverage to a strong U.S. spring. We favour POT, as well as AGU, which should have a robust H1 serving large acreages with continued opportunities for growth of private label seeds and chemicals in the Retail footprint. We remain cautious on more nitrogen-heavy names CF and YAR.” Agrium closed on Friday at $101.13.