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Analysts’ Recommendations and Price Targets for PotashCorp

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Analysts’ recommendations

On March 29, 2017, of the 18 analysts surveyed by Reuters, two had “strong buy” recommendations for PotashCorp (POT), while three had “buy” recommendations for the company for the next 12 months. Meanwhile, 11 analysts had “hold” recommendations on the stock, and only two had “sell” recommendations on the stock.

Peer comparison

Like PotashCorp (POT), CF Industries (CF), Agrium (AGU), and Mosaic (MOS) have received mostly “hold” recommendations. For more about these companies’ recommendations and price targets, read March Update: Agribusiness Stock Recommendations, Price Targets. Because analysts’ recommendations and price targets frequently change as new information becomes available, Market Realist makes an updated report available each month.

Price target

The consensus price target for PotashCorp on March 29, 2017, stood at $19 per share for the next 12 months. This price was ~12% higher than the company’s closing price of $17.10 on the same date. Analysts’ price target reached a low of $15.90 in August 2016, when expectations for agribusiness were at a low point.

Summary

PotashCorp continues to hold a strong position in the potash fertilizer sector (SOIL). The company enjoys the lowest cost of production in the sector, which may help the company offer discounts to gain more market share. However, a price war may not be an easy option due to the company’s strategic alignment within Canpotex.

An improvement in fertilizer prices should boost PotashCorp’s performance, but a sideways or downward movement in prices will likely continue to pressure the company’s performance. For more information on the agricultural fertilizer industry, be sure to visit Market Realist’s Agricultural Fertilizers page.

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