Farmer’s Edge Prices IPO at the Top of Range

Posted on February 28, 2021 by Mathieu Litalien

Late last week, Farmer's Edge priced its IPO at $17.00 per share as it filed its final long-form prospectus. Farmer's Edge was seeking to raise $100M at prices between $10-$17.00 per share. 

Farmers Edge will issue 7,353,000 common shares at a price of $17.00 per share for gross proceeds of $125,001,000, or $143,751,150 if the over-allotment option is exercised in full.

The pricing indicates strong demand for this digital agriculture company. As we indicated in our first update, we are big fans of industry disruptors and Farmer's Edge is uniquely situated to disrupt the agriculture industry. 

In total, Farmer's Edge will have 41,781,669 common shares if the over-allotment option is fully exercised. This gives it a market cap of ~$710M and Fairfax Financial is still expected to exert control over the company with a stake of approximately ~60%.

The company expects to exit 2020 with revenue of $46M which is almost a double over the $23.8M it generated in 2019. This is a much higher rate than the mid 30 per cent growth it achieved in the previous two years.

Based on the assumption that the overallotment is filled, Farmer's Edge has a P/S ratio of ~15 and on a forward basis that rate can drop to ~10 if it manages to achieve 50% growth in 2021. 

Compared to other high-flying SaaS companies, the company seems reasonably priced. There is no other true competitor in the space. It lists early stage products from John Deere and Bayer-Monsanto as potential competition but comparing valuation against these two makes no sense. 

This is a tech company that operates in the agriculture industry. Valuations range quite significantly for tech plays operating in niche industries. However, I'd say that at 15 times sales it is likely to see strong demand come the day of IPO which is expected to be on Wednesday, March 3.


News Release



February 24, 2021 – Farmers Edge Inc. (“Farmers Edge” or the “Company”) announced today that it has filed a final prospectus with the securities regulatory authorities in each of the provinces and territories of Canada and obtained a receipt therefor in respect of its initial public offering (the “Offering”) of common shares (“Common Shares”) of 7,353,000 Common Shares at a price of $17.00 per share (the “Offering Price”) for total gross proceeds of $125,001,000. A copy of the final prospectus in respect of the Offering is available on SEDAR at

The Offering is being made through a syndicate of underwriters led by National Bank Financial Inc. and CIBC Capital Markets acting as joint bookrunners, and includes Scotia Capital Inc., Canaccord Genuity Corp. and Raymond James Ltd. (collectively, the “Underwriters”). The Company has entered into an underwriting agreement in connection with the Offering, pursuant to which, among other things, the Company has granted to the Underwriters an over-allotment option (the “Over-Allotment Option”), exercisable in whole or in part for a period of 30 days following the closing of the Offering, to purchase up to an additional 1,102,950 Common Shares at the Offering Price for additional gross proceeds of up to $18,750,150 to the Company, if the Over-Allotment Option is exercised in full.

The closing of the Offering is expected to occur on or about March 3, 2021 (the “Closing Date”) and is subject to customary closing conditions, including the receipt of all necessary regulatory approvals. Farmers Edge has received conditional listing approval of the Toronto Stock Exchange (the “TSX”) for the listing of the Common Shares being issued and sold pursuant to the Offering. Listing remains subject to Farmers Edge fulfilling customary TSX requirements. The Common Shares are expected to commence trading on the TSX under the symbol “FDGE” on the Closing Date.

The Common Shares have not been and will not be registered under the United States Securities Act of 1933, as amended, or the securities laws of any state of the United States and may not be offered or sold within the United States unless an exemption from registration thereunder is available. This press release is not an offer to sell or a solicitation of an offer to buy any Common Shares in the United States.

About Farmers Edge

Farmers Edge is a global leader in digital agriculture delivering cutting-edge solutions powered by a unique combination of field-centric data, artificial intelligence, and complete integration. Farmers Edge is transforming the industry with disruptive technologies and strategic partnerships designed to enhance connectivity across the entire agricultural ecosystem. With the most comprehensive data management platform on the market–FarmCommand®–Farmers Edge is revolutionizing the way farmers, agricultural professionals, and agribusinesses interact with data. For more information please visit

For further information:
Farmers Edge
Jeffrey Kowall, Vice-President of Legal and Corporate Secretary

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Mathieu Litalien

About the author

Mathieu is an individual investor and has been investing part-time for the better part of the past 20 years. He is primarily interested in fundamental analysis, focusing on the long-term and his portfolio is composed primarily of dividend-paying equities. Mathieu has a moderate risk profile and also looks for growth and value. His passion for finance and the markets have led him to his MBA and writing for Seeking Alpha and Stocktrades. Mathieu also focuses primarily on stock research and content production for Premium and the Stocktrades blog.