Mosaic and CF Industry Holdings
Fertilizer producers and
distributors are in a very real bull market trend at this time as one of the
only industries to thrive in the current environment. Two of the companies in
this sector hit new 52 week highs earlier this week, Mosaic (MOS) and CF Industries
(CF). I am hesitant to put a large portion of a portfolio into one sector as
Bulk Shippers looked great for a period last year and then collapse, but the
fertilizer companies look too attractive at this time to not be a little
overweight in them.
CF Industries has analyst
upgrading their current year Earnings per share from 8.66 to 11.47 in the past
90 days. That is a 32% increase in the estimates. The company has a trailing price/earnings
ratio of 20.5 and year over year (yoy) quarterly EPS growth of 108.8%. Quarterly
revenue on a yoy basis is also impressive at 61.9%.
Mosaic is a favorite of mine and although
it doesn’t have the big earnings estimate increases this year of CF Industries,
it is still very attractive. Current year earnings estimates have increased
from 3.67 to 3.95 in the last 90 days. Next year’s earnings estimates have
increased from 5.77 to 9.35 in the same period. The second set of earning’s
estimates are very impressive at a 62% increase while this year’s estimates
have only increased 7.6%. Mosaic has quarterly (yoy) EPS growth of 270% and quarterly
revenue growth (yoy) of 68%. With a trailing P/E of 38, the stock still has
room to move higher.