May Update: CF Industries’ Price Target and Recommendations



CF Industries

Like fertilizer companies (MOO) The Mosaic Company (MOS) and Agrium (AGU), CF Industries (CF) had a weak 1Q17. The company posted adjusted EPS (earnings per share) of $0.05, missing analysts’ revised EPS estimate of $0.09.

Without adjustments, the company posted net EPS of -$0.10. Its EPS fell 88% compared to $0.4 per share in 1Q16. To learn more, read How CF Industries Performed in 1Q17.

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Analysts’ recommendations

The number of analysts recommending “strong buys” for CF Industries following its 1Q17 earnings rose to two from one. Similarly, the number of analysts recommending “buys” rose from five to six.

The number of analysts recommending “holds” on CF fell from 11 to nine, and the number of analysts recommending “sells” remained unchanged month-over-month. Based on these shifts in recommendations alone, it appears that analysts’ confidence in the stock is strengthening.

Price target

With the exception of PotashCorp (POT), all the fertilizer stocks we’ve discussed so far have seen price cuts, and the case was no different for CF Industries. Analysts lowered their month-over-month price target for CF Industries to $31.2 per share from $31.8 per share. On May 10, 2017, the stock closed at $27.6, a potential upside of ~12.9% if its current price converges with its target price in the next 12 months.

Next up, let’s talk about Monsanto.


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