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CF Industries Up 27% Over a Year: What's Driving the Stock?
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Shares of CF Industries Holdings, Inc. (CF - Free Report) have soared 26.5% over the past year, outperforming the industry’s gain of roughly 5.3%.
CF Industries has a market cap of roughly $8.6 billion and average volume of shares traded in the last three months was around 3,411.5K. The company has an expected long-term earnings per share growth rate of 6%.
Let’s take a look into the factors that are driving this Zacks Rank #1 (Strong Buy) stock.
Driving Factors
Better-than-expected fourth-quarter 2017 performance and solid growth prospects are contributing to the rally in CF Industries’ shares.
The company recorded a profit of $465 million or $1.98 per share in the fourth quarter against a loss of $320 million or $1.38 per share a year ago. Adjusted loss came in at 2 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 11 cents.
Moreover, estimates for the first-quarter and for the full-year 2018 have been going up lately reflecting analysts’ confidence in the stock. Over a month, the Zacks Consensus Estimate for the current quarter has been revised upward by 4% to 26 cents while the estimates for 2018 increased 13.9% to 90 cents.
CF Industries benefits from higher nitrogen demand driven by healthy corn plantations and cyclical recovery in the nitrogen fertilizer industry. The company expects India and Brazil to be major drivers for urea demand in 2018.
Brazil imported roughly 5.4 million metric tons of urea in 2017, up 15% year over year and has emerged as a major importer of the nutrient. India is expected to import roughly 500,000-1,000,000 metric tons during the first quarter of 2018. Import demand is also expected to be healthy in North America in 2018.
Moreover, CF Industries is likely to benefit from higher prices of nitrogen fertilizers. Higher selling prices boosted the company’s sales in the fourth-quarter. Tighter global nitrogen supply and demand balance supported nitrogen prices in the quarter.
The company expects higher energy costs in major producing regions, lower production in China, a weaker U.S. dollar, increased oil and freight costs and a steady global demand to support nitrogen prices during first-half 2018 at levels higher than the comparable period a year ago.
LyondellBasell has an expected long-term earnings growth rate of 9%. Its shares have moved up 14.8% over a year.
Kronos has an expected long-term earnings growth rate of 5%. Its shares have gained 39% over a year.
Daqo New Energy has an expected long-term earnings growth rate of 7%. Its shares have rallied 175.3% over a year.
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Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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CF Industries Up 27% Over a Year: What's Driving the Stock?
Shares of CF Industries Holdings, Inc. (CF - Free Report) have soared 26.5% over the past year, outperforming the industry’s gain of roughly 5.3%.
CF Industries has a market cap of roughly $8.6 billion and average volume of shares traded in the last three months was around 3,411.5K. The company has an expected long-term earnings per share growth rate of 6%.
Let’s take a look into the factors that are driving this Zacks Rank #1 (Strong Buy) stock.
Driving Factors
Better-than-expected fourth-quarter 2017 performance and solid growth prospects are contributing to the rally in CF Industries’ shares.
The company recorded a profit of $465 million or $1.98 per share in the fourth quarter against a loss of $320 million or $1.38 per share a year ago. Adjusted loss came in at 2 cents per share, which was narrower than the Zacks Consensus Estimate of a loss of 11 cents.
Moreover, estimates for the first-quarter and for the full-year 2018 have been going up lately reflecting analysts’ confidence in the stock. Over a month, the Zacks Consensus Estimate for the current quarter has been revised upward by 4% to 26 cents while the estimates for 2018 increased 13.9% to 90 cents.
CF Industries benefits from higher nitrogen demand driven by healthy corn plantations and cyclical recovery in the nitrogen fertilizer industry. The company expects India and Brazil to be major drivers for urea demand in 2018.
Brazil imported roughly 5.4 million metric tons of urea in 2017, up 15% year over year and has emerged as a major importer of the nutrient. India is expected to import roughly 500,000-1,000,000 metric tons during the first quarter of 2018. Import demand is also expected to be healthy in North America in 2018.
Moreover, CF Industries is likely to benefit from higher prices of nitrogen fertilizers. Higher selling prices boosted the company’s sales in the fourth-quarter. Tighter global nitrogen supply and demand balance supported nitrogen prices in the quarter.
The company expects higher energy costs in major producing regions, lower production in China, a weaker U.S. dollar, increased oil and freight costs and a steady global demand to support nitrogen prices during first-half 2018 at levels higher than the comparable period a year ago.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. Price and Consensus | CF Industries Holdings, Inc. Quote
Other Stocks to Consider
Some other top-ranked stocks worth considering in the basic materials space are LyondellBasell Industries N.V. (LYB - Free Report) , Kronos Worldwide, Inc. (KRO - Free Report) and Daqo New Energy Corp. (DQ - Free Report) , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
LyondellBasell has an expected long-term earnings growth rate of 9%. Its shares have moved up 14.8% over a year.
Kronos has an expected long-term earnings growth rate of 5%. Its shares have gained 39% over a year.
Daqo New Energy has an expected long-term earnings growth rate of 7%. Its shares have rallied 175.3% over a year.
Wall Street’s Next Amazon
Zacks EVP Kevin Matras believes this familiar stock has only just begun its climb to become one of the greatest investments of all time. It’s a once-in-a-generation opportunity to invest in pure genius.
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