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The fertilizer maker delivered a negative earnings surprise of around 10.5%, on average, over the trailing four quarters. It delivered a negative earnings surprise of 13.4% in the last reported quarter. The company’s first-quarter results are likely to reflect favorable demand for phosphate and potash. However, weaker fertilizer prices are expected to have affected its performance.
Shares of Mosaic have lost 30.6% in the past year compared with a 21.1% decline of the industry.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Indicate?
The Zacks Consensus Estimate for Mosaic’s first-quarter consolidated sales is currently pegged at $2,825.7 million, calling for a decline of 21.6% from the year-ago quarter’s tally.
Factors at Play
Mosaic is expected to have benefited from favorable demand for phosphate and potash in the March quarter, aided by favorable agricultural conditions. Attractive farm economics and improved affordability driving demand for fertilizers globally. Farmer economics remains attractive in most global growing regions on strong crop demand and affordable inputs. Demand for grains and oilseeds remains high along with strong farm economics.
Strong demand is expected to have supported the company’s potash sales volumes in the quarter to be reported. The company, last month, reported combined sales volumes for January and February 2024. During this period, potash sales volume reached 1,417,000 tons, up from 1,100,000 tons reported in the previous year. Our estimate for potash sales volumes for the first quarter is pegged at 2.110 million tons.
Moreover, MOS’s phosphate sales volume reached 1,087,000 tons in the first two months of first-quarter 2024, slightly up from 1,066,000 tons recorded during the same period in 2023. Our estimate for phosphate sales volumes for the first quarter stands at 1.699 million tons.
Weaker potash and phosphate prices may have impacted the company’s margins. Prices of phosphate and potash have retreated since the back half of 2022 from their peak levels attained in the first half riding on the impacts of the Russia-Ukraine war and disruptions due to the sanctions in Belarus.
Prices of crop nutrients remained under pressure during 2023 as the resumption of exports from top suppliers Belarus and Russia led to higher supplies. Weaker year-over-year fertilizer prices are expected to have weighed on the company’s profitability in the March quarter.
Our estimate for average selling price per ton for the Potash segment is pegged at $238, reflecting a year-over-year decline of 50%. We also expect average selling price per ton for the Phosphate unit to be $593, indicating a 17.3% year-over-year decline.
Our proven model does not conclusively predict an earnings beat for Mosaic this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Mosaic is -18.94%. The Zacks Consensus Estimate for earnings for the first quarter is currently pegged at 60 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Mosaic currently carries a Zacks Rank #5 (Strong Sell).
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
The consensus estimate for IOSP’s earnings for the first quarter is currently pegged at $1.64.
Kinross Gold Corporation (KGC - Free Report) , slated to release earnings on May 7, has an Earnings ESP of +4.49% and carries a Zacks Rank #3 at present.
The consensus mark for KGC’s first-quarter earnings is currently pegged at 6 cents.
Ingevity Corporation (NGVT - Free Report) , scheduled to release first-quarter earnings on May 1, has an Earnings ESP of +39.29%.
The Zacks Consensus Estimate for NGVT's earnings for the first quarter is currently pegged at 37 cents. NGVT currently carries a Zacks Rank #1.
Image: Bigstock
Mosaic (MOS) to Report Q1 Earnings: What's in the Offing?
The Mosaic Company (MOS - Free Report) is set to release first-quarter 2024 results on May 1, after the closing bell.
The fertilizer maker delivered a negative earnings surprise of around 10.5%, on average, over the trailing four quarters. It delivered a negative earnings surprise of 13.4% in the last reported quarter. The company’s first-quarter results are likely to reflect favorable demand for phosphate and potash. However, weaker fertilizer prices are expected to have affected its performance.
Shares of Mosaic have lost 30.6% in the past year compared with a 21.1% decline of the industry.
Image Source: Zacks Investment Research
Let’s see how things are shaping up for this announcement.
What do the Estimates Indicate?
The Zacks Consensus Estimate for Mosaic’s first-quarter consolidated sales is currently pegged at $2,825.7 million, calling for a decline of 21.6% from the year-ago quarter’s tally.
Factors at Play
Mosaic is expected to have benefited from favorable demand for phosphate and potash in the March quarter, aided by favorable agricultural conditions. Attractive farm economics and improved affordability driving demand for fertilizers globally. Farmer economics remains attractive in most global growing regions on strong crop demand and affordable inputs. Demand for grains and oilseeds remains high along with strong farm economics.
Strong demand is expected to have supported the company’s potash sales volumes in the quarter to be reported. The company, last month, reported combined sales volumes for January and February 2024. During this period, potash sales volume reached 1,417,000 tons, up from 1,100,000 tons reported in the previous year. Our estimate for potash sales volumes for the first quarter is pegged at 2.110 million tons.
Moreover, MOS’s phosphate sales volume reached 1,087,000 tons in the first two months of first-quarter 2024, slightly up from 1,066,000 tons recorded during the same period in 2023. Our estimate for phosphate sales volumes for the first quarter stands at 1.699 million tons.
Weaker potash and phosphate prices may have impacted the company’s margins. Prices of phosphate and potash have retreated since the back half of 2022 from their peak levels attained in the first half riding on the impacts of the Russia-Ukraine war and disruptions due to the sanctions in Belarus.
Prices of crop nutrients remained under pressure during 2023 as the resumption of exports from top suppliers Belarus and Russia led to higher supplies. Weaker year-over-year fertilizer prices are expected to have weighed on the company’s profitability in the March quarter.
Our estimate for average selling price per ton for the Potash segment is pegged at $238, reflecting a year-over-year decline of 50%. We also expect average selling price per ton for the Phosphate unit to be $593, indicating a 17.3% year-over-year decline.
The Mosaic Company Price and EPS Surprise
The Mosaic Company price-eps-surprise | The Mosaic Company Quote
Zacks Model
Our proven model does not conclusively predict an earnings beat for Mosaic this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for Mosaic is -18.94%. The Zacks Consensus Estimate for earnings for the first quarter is currently pegged at 60 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Mosaic currently carries a Zacks Rank #5 (Strong Sell).
Stocks That Warrant a Look
Here are some companies in the basic materials space you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Innospec Inc. (IOSP - Free Report) , scheduled to release earnings on May 9, has an Earnings ESP of +2.44% and carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus estimate for IOSP’s earnings for the first quarter is currently pegged at $1.64.
Kinross Gold Corporation (KGC - Free Report) , slated to release earnings on May 7, has an Earnings ESP of +4.49% and carries a Zacks Rank #3 at present.
The consensus mark for KGC’s first-quarter earnings is currently pegged at 6 cents.
Ingevity Corporation (NGVT - Free Report) , scheduled to release first-quarter earnings on May 1, has an Earnings ESP of +39.29%.
The Zacks Consensus Estimate for NGVT's earnings for the first quarter is currently pegged at 37 cents. NGVT currently carries a Zacks Rank #1.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.