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Mosaic to Support Sinochem's Modern Agriculture Platform

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The Mosaic Company (MOS - Free Report) has entered into a memorandum of understanding (“MOU”) with China’s largest agricultural inputs company — Sinochem. Per the MOU, Sinochem plans to buy phosphate rock and phosphate fertilizers from Mosaic, including premium products.

Sinochem is building a Modern Agriculture Platform for China. Mosaic aims to contribute to the significant initiative for Chinese farmers through this partnership. The MOU establishes a mutually beneficial relationship and enables Mosaic to provide expertise and products.

Mosaic’s shares have gained 21.1% in the past year, against the industry’s 8.6% decline.



In November, the company raised adjusted earnings per share (EPS) guidance for 2018, considering strong business performance and lower expected effective tax rate. It expects adjusted EPS in the range of $1.80-$2.00, up from the previous view of $1.45-$1.80. It also expects adjusted EBITDA for 2018 in the range of $1.90-$2 billion, up from the previous view of $1.80-$1.95 billion.

Mosaic is likely to gain from rising global demand for fertilizers. The Vale Fertilizantes acquisition is expected to deliver significant synergies. Additionally, the company is likely to benefit from cost-reduction initiatives and capacity expansion.

The Mosaic Company Price and Consensus

 

The Mosaic Company Price and Consensus | The Mosaic Company Quote

 

Zacks Rank & Stocks to Consider

Mosaic currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the basic materials space is Ingevity Corporation (NGVT - Free Report) , sporting a Zacks Rank #1 (Strong Buy); along with CF Industries Holdings, Inc. (CF - Free Report) and Cameco Corporation (CCJ - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Ingevity has an expected earnings growth rate of 21.5% for 2019. The company’s shares have gained 17.9% in the past year.  

CF Industries has an expected earnings growth rate of 70.5% for 2019. The company’s shares have moved up 7% in the past year.

Cameco has an expected earnings growth rate of 20% for 2019. Its shares have rallied 26% in a year’s time.

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