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The Mosaic Company Q3 Preview: Rebound Quarter Inbound?

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The Zacks Basic Materials sector has been relatively strong in 2022, down roughly 15% and outperforming the S&P 500 by a fair margin.

A widely-recognized company in the realm, The Mosaic Company (MOS - Free Report) , is on deck to unveil Q3 earnings on November 7th, after the market close.

The Mosaic Company is a leading producer and marketer of concentrated phosphate and potash for the global agriculture industry.

Currently, the company carries a Zacks Rank #4 (Sell) paired with an overall VGM Score of an A.

How does everything else stack up? Let’s take a closer look.

Share Performance & Valuation

MOS shares have been notably strong in 2022, up more than 25% and widely outperforming the S&P 500.

Zacks Investment Research
Image Source: Zacks Investment Research

Over the last three months, MOS shares have continued to outperform the S&P 500, down roughly 5%, vs. the S&P 500’s decline of more than 10%.

Zacks Investment Research
Image Source: Zacks Investment Research

The company’s P/B ratio comes in at 1.5X, above the five-year median of 1.1X but reflecting a 24% discount relative to its Zacks Basic Materials sector.

The company carries a Value Style Score of an A.

Zacks Investment Research
Image Source: Zacks Investment Research

Quarterly Estimates

Analysts have been bearish in their earnings outlook over the last several months, with four negative earnings estimate revisions hitting the tape. Still, the Zacks Consensus EPS Estimate of $3.52 indicates a Y/Y uptick in earnings of more than 160%.

Zacks Investment Research
Image Source: Zacks Investment Research

The company’s top-line is in solid standing also; the Zacks Consensus Sales Estimate of $6 billion suggests an improvement of more than 75% from year-ago quarterly sales of $3.4 billion.

Quarterly Performance

MOS has struggled to exceed quarterly estimates, falling short of revenue and earnings estimates in back-to-back quarters.

In its latest print, the company registered a 7.3% bottom-line miss paired with a 4.3% revenue miss. Below is a chart illustrating the company’s revenue on a quarterly basis.

Zacks Investment Research
Image Source: Zacks Investment Research

Putting Everything Together

MOS shares have been visibly strong in 2022, outperforming the S&P 500 across several timeframes. Still, over the last three months, the buying has slowed.

The company’s price-to-book ratio sits above its five-year median but below its Zacks sector average.

Analysts have been bearish in their earnings outlook, and estimates indicate sizable Y/Y upticks in both revenue and earnings.

MOS has struggled to exceed quarterly estimates as of late, falling short of revenue and earnings expectations in back-to-back quarters.

Heading into the print, The Mosaic Company (MOS - Free Report) carries a Zacks Rank #4 (Sell) paired with an Earnings ESP Score of 2.5%.


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