Potash Corp. of Saskatchewan, Inc. (Ticker:POT)
The run up in the market size for technology over the last 4 decades coincided with the dawn of an Information Age. We are now in the dawn of a Biological Revolution and Potash is a valuable and constrained ingredient.
If you have 20 or more years to invest, the world economy will look different when you sell than it does today. As agriculture demand expands to fit an emerging global population that doesn’t starve, production and productivity has to rise. Potash is the constraining factor. I expect demand to rise strongly for decades and, because supply is constrained (with what we know now), prices should rise.
With a profit margin at 30% and an operating margin at 38%, they achieve ROE of 28%. Great numbers for a company with $6billion in revenues. Their dividend isn’t much to look at, but with quarterly revenue growth of 68% since last year, reinvesting in growth is a good move on their part.