A Canadian Dividend Stock Down 34% I’d Buy for Retirement Income

Nutrien’s 35% drop from its 2022 high could offer upside plus income, but only if fertilizer fundamentals keep improving.

Amy Legate-Wolfe

Author Bio Amy became interested in investing in 2018 after having her first daughter. After receiving a masters degree in journalism from Western University, she became frustrated that the finance industry remained a confusing place for Canadians like her: new parents, millennials, and other young people who needed to understand their finances. Now, Amy focuses on tech companies and renewable energy for growth opportunities, coupling that with long-term investing strategies and equities. She also provides investors with a daily newsletter, Canada Stock Digest, for daily market updates. Her work can also be found at Canada's National Observer, where she writes on the business side of climate action. Before joining Motley Fool Canada, Amy wrote for major news organizations including HuffPost, CTVNews.ca, and CBC. When she’s not researching investing strategies, Amy’s time is pretty much monopolized by her two wild daughters, but in what little spare time she has she loves to do yoga, go on walks with her dog, and travel with her husband. Social Media Follow Amy on LinkedIn and Canada Stock Digest. Favorite Investment Quote “October: This is one of the particularly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February.” – Mark Twain

Published July 31, 4:10 pm EDT

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Key Points

Nutrien is about 35% below its 2022 peak, and a return to that level would mean a big gain.
Earnings are recovering and the dividend looks covered, with free cash flow comfortably exceeding dividend costs.
Fertilizer demand is long-term, but prices and farmer spending are cyclical, so buy gradually and diversify.

A stock trading 34% below its old peak doesn’t need a miracle to make retirement investors considerably richer. Returning to that peak would require a gain of roughly 54%, while dividends could keep arriving along the way. The rather important catch is ensuring the old high wasn’t simply the market losing its head.

Retirees sip their morning coffee outside. — Source: Getty Images

Considerations

A falling share price can signal opportunity, deteriorating fundamentals, or both wearing the same trench coat. Retirement investors should therefore examine whether cash flow covers the dividend, whether the business can grow through a full economic cycle, and whether debt leaves room for unpleasant surprises.

Dividend growth deserves attention as well. The Bank of Canada targets inflation around 2%, meaning a permanently flat payout gradually buys less. Reinvesting covered dividends before retirement can purchase additional shares, allowing income to grow through both dividend increases and Canadian dividend stocks accumulated over time.

Payment frequency matters considerably less. Quarterly dividends can be pooled into monthly withdrawals just as easily as monthly payments. With those retirement-income basics covered, one beaten-down Canadian company looks unusually interesting.

Down, but not out

Nutrien (TSX:NTR) recently traded near $97, approximately 34% below its 2022 peak of $147.97. Nutrien stock is one of the world’s largest crop-input providers, producing potash, nitrogen, and phosphate while selling fertilizer, seeds, crop-protection products, and services directly to farmers.

That mix gives Nutrien stock two different income engines. Fertilizer production supplies considerable upside when prices rise, while its enormous agricultural retail network provides a steadier relationship with growers. Feeding a growing global population remains less optional than many consumer trends, even if fertilizer pricing occasionally behaves like it has consumed six espressos.

The decline followed an extraordinary 2022 fertilizer-price surge triggered by global supply disruptions. Prices later normalized, pulling earnings and the stock away from their peaks. Investors shouldn’t assume Nutrien stock will immediately reclaim that wartime valuation, although recent results suggest the business is no longer moving backwards.

Into earnings

First off, first-quarter adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 30% to US$1.11 billion. Nutrien stock delivered record potash sales volumes alongside stronger nitrogen and retail performance, supported by tighter fertilizer markets and production from its low-cost North American assets.

The quarterly dividend was recently increased by approximately 1%, coming in at a total dividend of $3.12, yielding about 3.3% at writing. More importantly, the payout appears manageable. Nutrien stock generated US$1.98 billion in free cash flow during 2025, while its annualized dividend currently costs roughly US$1.06 billion. That leaves cash for debt reduction, investment, and share repurchases rather than requiring every available dollar to keep retirees paid.

The shares trade around 14 times trailing earnings at the time of writing this article. That isn’t a once-in-a-generation valuation, but it looks reasonable for recovering earnings, a covered dividend, and exposure to long-term food demand.

Bottom line

There are factors to consider, of course. Nutrien stock remains cyclical. Lower crop or fertilizer prices, weak farmer spending, higher natural-gas and sulphur costs, operational disruptions, and poor weather could reduce cash flow. Currency movements can also change the Canadian-dollar dividend, while management’s reviews of several underperforming operations introduce execution risk.

I’d therefore make Nutrien stock one diversified retirement holding, not the entire plan wearing a farmer’s hat. Investors buying stocks in Canada could build the position gradually and reinvest the quarterly income. If improving fertilizer fundamentals continue, today’s discount may provide both rising retirement cash and considerably more valuable shares later.