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Potash Corp. (POT) Q2 Earnings Meet, Revenues Miss

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Potash Corp. of Saskatchewan, Inc.  is a fertilizer company producing three primary plant nutrients – potash, phosphate and nitrogen.

Potash Corp. has a competitive advantage stemming from its mining rights to the world's largest potash reserve. However, the company is exposed to macroeconomic uncertainties including price volatility and currency fluctuations. The company also faces earnings headwinds caused by tax changes.

Let’s have a quick look at the company’s second-quarter 2016 release.

Estimate Trend & Surprise History

Investors should note that the earnings estimate for Potash Corp. for the second quarter has declined by 2 cents over the last month. The company has missed the Zacks Consensus Estimate in all of the trailing 4 quarters with an average negative surprise of 10.16%.

POTASH SASK Price and EPS Surprise

POTASH SASK Price and EPS Surprise | POTASH SASK Quote

Earnings

Potash Corp. delivered adjusted earnings of 18 cents per share for the quarter. That matched the Zacks Consensus Estimate of 18 cents.

Revenues

Potash Corp. reported net sales of $935 million. That missed the Zacks Consensus Estimate of $1,137 million.

Key Developments to Note

The company has decided to lower its quarterly dividend by 60% to 10 cents per share beginning from the next dividend announcement in Sep.

Due to the challenging market conditions, Potash Corp. lowered its full-year 2016 earnings guidance to the range of 40 cents to 55 cents per share. For the third quarter, the company expects earnings to be in the range of 5 cents to 10 cents per share.

Zacks Rank

Currently, Potash Corp. has a Zacks Rank #5 (Strong Sell), which reflects the headwinds faced by the company.

Market Reaction

Potash Corp’s shares were inactive in pre-market trading. It would be interesting to see how the market reacts to the results during the trading session today. 

Check back later for our full write up on Potash Corp’s earnings report!

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