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Why Is CF (CF) Up 18.5% Since Last Earnings Report?
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It has been about a month since the last earnings report for CF Industries (CF - Free Report) . Shares have added about 18.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is CF due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
CF Industries' Earnings Top, Sales Miss Estimates in Q4
CF Industries reported a profit of $705 million or $3.27 per share in the fourth quarter of 2021 compared with $87 million or 40 cents in the year-ago quarter.
Barring one-time items, adjusted earnings per share (EPS) was $3.71. The bottom line topped the Zacks Consensus Estimate of $3.41.
Net sales increased 130.5% year over year to $2,540 million in the quarter. However, the figure missed the Zacks Consensus Estimate of $2,594.4 million.
Segment Review
Net sales in the Ammonia segment increased 161% year over year to $778 million in the reported quarter. Fourth-quarter sales volume increased from the prior year’s levels. Average selling prices in the fourth quarter increased year over year.
Sales in the Granular Urea segment increased 98.8% year over year to $662 million. Average selling prices for urea increased while sales volume declined in the quarter.
Sales in the UAN segment surged 169% year over year to $732 million. Sales volume in the fourth quarter were down from prior year’s levels. Average selling prices increased in the quarter.
Sales in the AN segment increased 34.8% year over year to $151 million. In the fourth quarter, sales volume declined year over year while average selling prices increased.
FY21 Results
Earnings (as reported) for full-year 2021 were $4.24 per share compared with $1.47 a year ago. Net sales increased 58.5% year over year to roughly $6,538 million.
Financials
CF Industries’ cash and cash equivalents increased 138.4% year over year to $1,628 million at the end of the year. Long-term debt was $3,465 million at the end of the year, down 6.7% year over year.
Cash flow from operations amounted to $2.87 billion in the year, up 133.4% year over year. The company repurchased around 7.5 million shares for $490 million during the fourth quarter.
Outlook
CF Industries expects global nitrogen supply and demand balance to remain tight in the foreseeable future. The company anticipates the commercial environment to be highly favorable for producers in low-cost regions in 2022.
The company forecasts global nitrogen inventory to be low after a year of strong demand and lower production led by the impact of energy-related production restrictions and shutdowns in Europe, weather-related disruptions in North America and stagnant production levels in countries including India. The elevated energy prices in Europe and Asia, along with ongoing restrictions on exports of certain nitrogen products from Russia, Egypt, Turkey and China, indicate global nitrogen supply will continue to be challenged, the company noted.
The global demand for nitrogen is projected to be strong. Higher economic activity continues to drive strong demand for diesel exhaust fluid for emissions abatement as well as ammonia, urea and nitric acid for industrial uses.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 6.13% due to these changes.
VGM Scores
At this time, CF has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, CF has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is CF (CF) Up 18.5% Since Last Earnings Report?
It has been about a month since the last earnings report for CF Industries (CF - Free Report) . Shares have added about 18.5% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is CF due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
CF Industries' Earnings Top, Sales Miss Estimates in Q4
CF Industries reported a profit of $705 million or $3.27 per share in the fourth quarter of 2021 compared with $87 million or 40 cents in the year-ago quarter.
Barring one-time items, adjusted earnings per share (EPS) was $3.71. The bottom line topped the Zacks Consensus Estimate of $3.41.
Net sales increased 130.5% year over year to $2,540 million in the quarter. However, the figure missed the Zacks Consensus Estimate of $2,594.4 million.
Segment Review
Net sales in the Ammonia segment increased 161% year over year to $778 million in the reported quarter. Fourth-quarter sales volume increased from the prior year’s levels. Average selling prices in the fourth quarter increased year over year.
Sales in the Granular Urea segment increased 98.8% year over year to $662 million. Average selling prices for urea increased while sales volume declined in the quarter.
Sales in the UAN segment surged 169% year over year to $732 million. Sales volume in the fourth quarter were down from prior year’s levels. Average selling prices increased in the quarter.
Sales in the AN segment increased 34.8% year over year to $151 million. In the fourth quarter, sales volume declined year over year while average selling prices increased.
FY21 Results
Earnings (as reported) for full-year 2021 were $4.24 per share compared with $1.47 a year ago. Net sales increased 58.5% year over year to roughly $6,538 million.
Financials
CF Industries’ cash and cash equivalents increased 138.4% year over year to $1,628 million at the end of the year. Long-term debt was $3,465 million at the end of the year, down 6.7% year over year.
Cash flow from operations amounted to $2.87 billion in the year, up 133.4% year over year. The company repurchased around 7.5 million shares for $490 million during the fourth quarter.
Outlook
CF Industries expects global nitrogen supply and demand balance to remain tight in the foreseeable future. The company anticipates the commercial environment to be highly favorable for producers in low-cost regions in 2022.
The company forecasts global nitrogen inventory to be low after a year of strong demand and lower production led by the impact of energy-related production restrictions and shutdowns in Europe, weather-related disruptions in North America and stagnant production levels in countries including India. The elevated energy prices in Europe and Asia, along with ongoing restrictions on exports of certain nitrogen products from Russia, Egypt, Turkey and China, indicate global nitrogen supply will continue to be challenged, the company noted.
The global demand for nitrogen is projected to be strong. Higher economic activity continues to drive strong demand for diesel exhaust fluid for emissions abatement as well as ammonia, urea and nitric acid for industrial uses.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
The consensus estimate has shifted 6.13% due to these changes.
VGM Scores
At this time, CF has a great Growth Score of A, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, CF has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.