Higher food prices aren't disappearing any time soon - meaning it's time to revisit one of the best "Buys" in the agricultural industry - Monsanto Co. (NYSE: MON).
I first called Monsanto Co. a "Buy" in October 2010, when I told you the company had started a rebound that would pay off for investors. The stock was trading at $56 a share and down 34% for the year - compared to an 11% gain in the Standard & Poor's 500 Index.
Since my recommendation, Monsanto has reversed its downward trend and is up more than 23% -- almost triple the S&P 500's 3.4% rise. The stock hit a 52-week high of $77.09 on July 25 before recent volatility dented its comeback. Monsanto stock closed Friday at $69.77.
If you missed getting a position on Monsanto the first time around, it's not too late. This innovative global Ag leader is still taking off.
You see, St. Louis, MO-based Monsanto is the largest producer of seeds to commercial farms. With food prices expected to increase 4% next year, and global reserves dwindling, demand for Monsanto's products will rise.
This means Monsanto should see record-high seed prices and margins.
Not only that, Monsanto has a competitive edge: It's a leader in creating genetically modified seeds that help crops reach levels of productivity unimaginable a few decades ago.
So it's time - again - to buy Monsanto Co. (**) - especially if you didn't get a chance to pick it up last year. If you already have shares, I suggest you continue holding them and possibly look to add to your position.
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