3 international companies whose products you could soon be using


The United States produces 22% of the world’s gross domestic product (GDP), but is home to only 4.3% of the total human population. All this capital and a consumer-driven economy make America a premier destination for international businesses looking to sell their latest wares. But is your portfolio exposed to companies based outside of the United States?

The usual due diligence applies when looking at international businesses, of course, but first you need to know where to look. We asked three contributors to The Motley Fool about a foreign company they oversee that is increasing its exposure in the United States. Here’s why they chose Nutrien (NYSE: NTR), Toyota engine (NYSE: TM), and Canopy growth (NASDAQ: CGC).

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Digital agriculture for a better agricultural economy

Maxx Chatsko (Nutrien): You probably already use some of the Canadian Fertilizer Company’s products, albeit indirectly. But the distance between American consumers and the business will narrow over the next decade. Nutrien has announced its goal of increasing its market share in the $ 40 billion agricultural retail market in the United States, from 20% today to 30% in the years to come. The strategy to achieve this could attract the attention of investors.

Nutrien is quietly positioning itself for the future of agriculture by expanding its offer in new organic products (living technologies that increase crop yields while reducing chemical inputs) and digital agriculture. The latter may soon become the first platform available to American farmers thanks to the company’s dominant position in retail.

Digital agriculture works relatively simply. Customers subscribe to the main platform, which provides farmers with data collected from satellites and historical climate models for their land, sometimes with resolution down to each row of crops. Farmers can then plan more precisely for buying and selling produce, planting seeds, applying fertilizers and pesticides, and harvesting. The idea is to empower farmers to make data-driven decisions to increase yields and profits.

Nutrien announced that its digital agriculture platform was being used by customers representing more than 50% of its retail sales in North America just six months after its launch. This equates to $ 6.3 billion in annual revenue. And this figure does not take into account the acquisitions made in 2019 or a recently announced partnership to integrate with the digital offerings of BASF.

In other words, the food on your table could soon be cultivated with the help of digital farming. Considering the huge opportunity, the fact that Nutrien shares have an annual dividend yield of 3.3%, and the fact that the company is poised to steadily increase its profits during the year 2019, investors might want to take a closer look.

A drawing on the pavement of a car with a plug sticking out at the back.

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The wave of electrification is here

Brian Feroldi (Toyota Motors): Tesla has shaken up the auto market by proving that there is a strong pent-up demand for large electric vehicles. Almost all of the major automakers are now scrambling to meet this demand and electrify their fleets.

Toyota Motor was one of the first major automakers to massively adopt batteries with its switch to hybrids over a decade ago, but it has been much slower with the introduction of all-electric vehicles. But that’s about to change. Toyota has announced plans to market “more than 10” battery-electric vehicles over the next few years. His initial focus will be the Chinese market, but he plans to focus on the United States soon after.

Toyota has also promised to electrify its entire fleet of Toyota and Lexus cars by the mid-2020s. This suggests that American consumers will soon be able to purchase all-electric versions of Toyota’s best-selling cars, such as the Camry, the Corolla and the Highlander.

The big question for investors is whether or not there will be consumer demand to purchase these all-electric vehicles once they are finally available. Tesla is currently the market leader by far, and its Model 3 generates more revenue in the United States than even the most popular gasoline cars such as the Camry and Honda OK. Toyota could struggle to break into this market and wrest market share from a rival so far ahead.

The good news here is that all of the inbound competition is likely to be a major victory for consumers. More choices in electric cars should lead to lower prices and better cars over time.

Cannabis leaves on white background.

Image source: Getty Images.

It’s high time for a new competition

Demitri Kalogeropoulos (Canopy Growth): Unlike Canopy Growth’s home country of Canada, federal law prohibits the company from manufacturing, selling or distributing marijuana here in the United States.

Still, Canopy Growth is adding a significant presence in this country right now, which aims to meet the growing demand for hemp and cannabidiol (CBD) infused products that include everything from skin creams and shampoos to drinks. By some estimates, the CBD market has grown to $ 20 billion in the United States in just a few years.

Of course, Canopy Growth is doing its best to position itself to dominate the market in case the legalization of marijuana occurs at the federal level. As the largest company in the industry, with influential partnerships such as the alcoholic beverage giant Constellation brands, Canopy has a good chance of gaining a foothold in what could be a massive consumer industry. But for now, investors will be watching to see if the company can replicate its pioneering advantages in Canada as it tiptoes into the US market.

This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.


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