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Why You Should Add CF Industries (CF) Stock to Your Portfolio
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CF Industries Holdings, Inc.’s (CF - Free Report) stock looks promising at the moment. The company’s shares have popped roughly 52% over the past three months. It is benefiting from healthy demand for nitrogen fertilizers and higher nitrogen prices.
We are positive on the company’s prospects and believe that the time is right for you to add the stock to the portfolio as it looks promising and is poised to carry the momentum ahead.
CF Industries currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors.
Let's see what makes this fertilizer maker an attractive investment option at the moment.
Price Performance
Shares of CF Industries have shot up 122.2% over a year against the 67.7% rise of its industry. It has also outperformed the S&P 500’s roughly 10% rise over the same period.
Image Source: Zacks Investment Research
Estimates Going Up
Over the past two months, the Zacks Consensus Estimate for CF Industries for 2022 has increased around 22.1%. The consensus estimate for first-quarter 2022 has also been revised 9.1% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
Solid Growth Prospects
The Zacks Consensus Estimate for earnings for the current year for CF Industries is currently pegged at $15.81, reflecting an expected year-over-year growth of 272.9%. Moreover, earnings are expected to register an 498.6% growth in the first quarter of 2022.
Superior Return on Equity (ROE)
ROE is a measure of a company’s efficiency in utilizing shareholder’s funds. ROE for the trailing 12-months for CF Industries is 24.1%, above the industry’s level of 16.8%.
Capital Allocation
CF Industries remains committed to boosting shareholders’ value by leveraging strong cash flows. It generated operating cash flows of roughly $2.9 billion and free cash flow of around $2.2 billion in 2021. The company also paid dividend worth $260 million in 2021. During the fourth quarter, it repurchased around 7.5 million shares for $490 million. Its board, in November 2021, approved a new $1.5 billion share repurchase program.
Upbeat Prospects
CF Industries is gaining from higher nitrogen fertilizer demand in major markets. Global demand for nitrogen is expected to remain strong in 2022. Higher crop commodity prices are contributing to healthy demand globally. Industrial demand has also recovered from the pandemic-related disruptions. In 2022, demand for nitrogen is expected to be driven by higher industrial and economic activities and high levels of corn planted acres in the United States. Demand for urea imports from Brazil and India is also expected to be strong this year. Higher crop prices, increased planted corn acres and improved farm economics are likely to increase demand in Brazil.
CF Industries, on its fourth-quarter call, said that it expects global nitrogen supply and demand balance to remain tight in the foreseeable future. The company anticipates the commercial environment to be highly favorable for producers in low-cost regions in 2022. The global demand for nitrogen is projected to be strong.
The company is also benefiting from higher nitrogen prices on the back of lower supply resulting from reduced operating rates across Europe and Asia due to higher energy prices. Higher nitrogen prices are driving its sales as witnessed in the last-reported quarter. The positive pricing environment is expected to continue moving ahead.
Other top-ranked stocks worth considering in the basic materials space include Nutrien Ltd. (NTR - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Commercial Metals Company (CMC - Free Report) .
Nutrien, sporting a Zacks Rank #1, has an expected earnings growth rate of 106.4% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 35.9% upward over the last 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Nutrien beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 60.3%, on average. NTR has rallied around 85% in a year.
AdvanSix, carrying a Zacks Rank #1, has an expected earnings growth rate of 64.9% for the current year. ASIX's consensus estimate for current-year earnings has been revised 53% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 46.9%. ASIX has rallied around 78% in a year.
Commercial Metals, carrying a Zacks Rank #1, has a projected earnings growth rate of 114.7% for the current fiscal year. The Zacks Consensus Estimate for CMC's current fiscal year earnings has been revised 35.1% upward over the past 60 days.
Commercial Metals beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missed once. It has a trailing four-quarter earnings surprise of roughly 13.7%, on average. CMC has gained around 34% in a year.
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Why You Should Add CF Industries (CF) Stock to Your Portfolio
CF Industries Holdings, Inc.’s (CF - Free Report) stock looks promising at the moment. The company’s shares have popped roughly 52% over the past three months. It is benefiting from healthy demand for nitrogen fertilizers and higher nitrogen prices.
We are positive on the company’s prospects and believe that the time is right for you to add the stock to the portfolio as it looks promising and is poised to carry the momentum ahead.
CF Industries currently has a Zacks Rank #2 (Buy) and a VGM Score of A. Our research shows that stocks with a VGM Score of A or B, combined with a Zacks Rank #1 (Strong Buy) or 2, offer the best investment opportunities for investors.
Let's see what makes this fertilizer maker an attractive investment option at the moment.
Price Performance
Shares of CF Industries have shot up 122.2% over a year against the 67.7% rise of its industry. It has also outperformed the S&P 500’s roughly 10% rise over the same period.
Image Source: Zacks Investment Research
Estimates Going Up
Over the past two months, the Zacks Consensus Estimate for CF Industries for 2022 has increased around 22.1%. The consensus estimate for first-quarter 2022 has also been revised 9.1% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
Solid Growth Prospects
The Zacks Consensus Estimate for earnings for the current year for CF Industries is currently pegged at $15.81, reflecting an expected year-over-year growth of 272.9%. Moreover, earnings are expected to register an 498.6% growth in the first quarter of 2022.
Superior Return on Equity (ROE)
ROE is a measure of a company’s efficiency in utilizing shareholder’s funds. ROE for the trailing 12-months for CF Industries is 24.1%, above the industry’s level of 16.8%.
Capital Allocation
CF Industries remains committed to boosting shareholders’ value by leveraging strong cash flows. It generated operating cash flows of roughly $2.9 billion and free cash flow of around $2.2 billion in 2021. The company also paid dividend worth $260 million in 2021. During the fourth quarter, it repurchased around 7.5 million shares for $490 million. Its board, in November 2021, approved a new $1.5 billion share repurchase program.
Upbeat Prospects
CF Industries is gaining from higher nitrogen fertilizer demand in major markets. Global demand for nitrogen is expected to remain strong in 2022. Higher crop commodity prices are contributing to healthy demand globally. Industrial demand has also recovered from the pandemic-related disruptions. In 2022, demand for nitrogen is expected to be driven by higher industrial and economic activities and high levels of corn planted acres in the United States. Demand for urea imports from Brazil and India is also expected to be strong this year. Higher crop prices, increased planted corn acres and improved farm economics are likely to increase demand in Brazil.
CF Industries, on its fourth-quarter call, said that it expects global nitrogen supply and demand balance to remain tight in the foreseeable future. The company anticipates the commercial environment to be highly favorable for producers in low-cost regions in 2022. The global demand for nitrogen is projected to be strong.
The company is also benefiting from higher nitrogen prices on the back of lower supply resulting from reduced operating rates across Europe and Asia due to higher energy prices. Higher nitrogen prices are driving its sales as witnessed in the last-reported quarter. The positive pricing environment is expected to continue moving ahead.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. price-consensus-chart | CF Industries Holdings, Inc. Quote
Stocks to Consider
Other top-ranked stocks worth considering in the basic materials space include Nutrien Ltd. (NTR - Free Report) , AdvanSix Inc. (ASIX - Free Report) and Commercial Metals Company (CMC - Free Report) .
Nutrien, sporting a Zacks Rank #1, has an expected earnings growth rate of 106.4% for the current year. The Zacks Consensus Estimate for NTR's current-year earnings has been revised 35.9% upward over the last 60 days. You can see the complete list of today’s Zacks #1 Rank stocks here.
Nutrien beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missing once. It has a trailing four-quarter earnings surprise of roughly 60.3%, on average. NTR has rallied around 85% in a year.
AdvanSix, carrying a Zacks Rank #1, has an expected earnings growth rate of 64.9% for the current year. ASIX's consensus estimate for current-year earnings has been revised 53% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 46.9%. ASIX has rallied around 78% in a year.
Commercial Metals, carrying a Zacks Rank #1, has a projected earnings growth rate of 114.7% for the current fiscal year. The Zacks Consensus Estimate for CMC's current fiscal year earnings has been revised 35.1% upward over the past 60 days.
Commercial Metals beat the Zacks Consensus Estimate for earnings in three of the last four quarters while missed once. It has a trailing four-quarter earnings surprise of roughly 13.7%, on average. CMC has gained around 34% in a year.