Mosaic Company Struggles Amid Broader Market Gains
Tampa, Florida-based The Mosaic Company (MOS) produces and markets concentrated phosphate and potash crop nutrients in both North America and internationally. With a market cap of $8.9 billion, Mosaic operates through three main segments: Phosphates, Potash, and Mosaic Fertilizantes.
Market Performance: MOS vs. S&P 500
Over the past year, Mosaic has significantly lagged behind the broader market. MOS stock has fallen 21.4% year-to-date (YTD) and 15.8% over the past year. In contrast, the S&P 500 Index ($SPX) has surged by 21.2% in 2024 and 32.7% over the last 52 weeks.
Comparative Analysis: MOS vs. Agriculture ETF
Focusing more closely, MOS has also underperformed the First Trust Indxx Global Agriculture ETF (FTAG), which has seen only a 2.2% decline YTD, while Mosaic’s performance has dipped slightly over the same 52-week period.
Disappointing Earnings Report
Mosaic stock price dropped 1.4% following its disappointing Q2 earnings report released on August 6. The company saw a significant 17% year-over-year decline in net sales, totaling $2.8 billion, which was 3.9% below Wall Street estimates. Additionally, a 21.5% decrease in adjusted EBITDA was reported, largely due to weak performances in its Potash and Phosphate segments. This caused adjusted EPS to plummet 48.1% to $0.54 compared to the previous year, missing analysts’ expectations by a substantial 20.6%.
Future Earnings Expectations
For the fiscal year ending in December, analysts predict a 36.4% drop in adjusted EPS to $2.27. Unlike most firms, Mosaic’s earnings history has been disappointing, missing Wall Street’s estimates three times in the last four quarters, with only one successful quarter.
Analysts’ Ratings on MOS Stock
MOS stock currently holds a consensus “Moderate Buy” rating. Among the 14 analysts following the stock, five recommend a “Strong Buy,” eight suggest a “Hold,” and one advises a “Strong Sell.” This is a slight decrease in bullish sentiment compared to last month, when six analysts had issued a “Strong Buy” call.
Analyst Price Target Adjustments
On October 12, Barclays PLC (BCS) analyst Benjamin Theurer maintained a “Buy” rating but lowered the price target to $30. The revised target reflects concerns over forecasted hurricanes impacting Q3 and Q4 as well as falling crop prices affecting farmers’ earnings. This shift in focus toward cost reduction poses challenges for any potential increases in fertilizer prices.
Market Outlook: Price Targets
The mean price target for Mosaic is now $32.73, indicating a potential upside of 16.6% from current price levels. The highest target in the market stands at $45, suggesting an upside potential of 60.3%.
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On the date of publication, Aditya Sarawgi did not hold (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
