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CF Industries (CF) Hits 52-Week High: What's Aiding the Stock?
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CF Industries Holdings, Inc. (CF - Free Report) scaled a fresh 52-week high of $104.89 on Mar 23, before closing the session at $103.59.
The company, carrying a Zacks Rank #3 (Hold), has a market cap of around $20.7 billion. It also has an expected long-term earnings per share growth rate of around 6%.
Shares of CF Industries have gained 129.3% in the past year compared with a 70.1% rise of the industry.
Image Source: Zacks Investment Research
What’s Driving CF?
CF Industries is gaining from higher nitrogen fertilizer demand in major markets. Global demand for nitrogen is expected to remain strong in 2022. Higher crop commodity prices are contributing to healthy demand globally. Industrial demand has also recovered from the pandemic-related disruptions. In 2022, demand for nitrogen is expected to be driven by higher industrial and economic activities and increased levels of corn planted acres in the United States. Demand for urea imports from Brazil and India is expected to be strong this year. Higher crop prices, increased planted corn acres and improved farm economics are likely to increase demand in Brazil.
The company also benefits from higher nitrogen prices on the back of lower supply resulting from reduced operating rates across Europe and Asia due to higher energy prices. Higher nitrogen prices are driving sales, as witnessed in the last reported quarter. The positive pricing environment is expected to continue moving ahead.
CF Industries also remains committed to boosting shareholders’ value by leveraging strong cash flows. It generated operating cash flows of roughly $2.9 billion and a free cash flow of around $2.2 billion in 2021. The company also paid out dividends worth $260 million in 2021. During the fourth quarter, CF repurchased around 7.5 million shares for $490 million. In November 2021, its board approved a new $1.5-billion share repurchase program.
Earnings estimates for CF Industries have also been going up over the past two months. The Zacks Consensus Estimate for 2022 has increased around 22.1%. The consensus estimate for first-quarter 2022 has also been revised 9.1% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
Some better-ranked stocks in the basic materials space are Univar Solutions Inc. , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) .
Univar has a projected earnings growth rate of 18.5% for the current year. The Zacks Consensus Estimate for UNVR's current-year earnings has been revised 34.2% upward in the past 60 days.
Univar beat the Zacks Consensus Estimate for earnings in three of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 30.9%, on average. UNVR has rallied around 56.8% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AdvanSix has a projected earnings growth rate of 64.8% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 58% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, the average being 23.6%. ASIX has surged 99.3% in a year. The company sports a Zacks Rank #1.
Allegheny, currently carrying a Zacks Rank #1, has an expected earnings growth rate of 661.5% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised 45.6% upward in the past 60 days.
Allegheny beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 127.2%. ATI has rallied around 33.3% over a year.
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CF Industries (CF) Hits 52-Week High: What's Aiding the Stock?
CF Industries Holdings, Inc. (CF - Free Report) scaled a fresh 52-week high of $104.89 on Mar 23, before closing the session at $103.59.
The company, carrying a Zacks Rank #3 (Hold), has a market cap of around $20.7 billion. It also has an expected long-term earnings per share growth rate of around 6%.
Shares of CF Industries have gained 129.3% in the past year compared with a 70.1% rise of the industry.
Image Source: Zacks Investment Research
What’s Driving CF?
CF Industries is gaining from higher nitrogen fertilizer demand in major markets. Global demand for nitrogen is expected to remain strong in 2022. Higher crop commodity prices are contributing to healthy demand globally. Industrial demand has also recovered from the pandemic-related disruptions. In 2022, demand for nitrogen is expected to be driven by higher industrial and economic activities and increased levels of corn planted acres in the United States. Demand for urea imports from Brazil and India is expected to be strong this year. Higher crop prices, increased planted corn acres and improved farm economics are likely to increase demand in Brazil.
The company also benefits from higher nitrogen prices on the back of lower supply resulting from reduced operating rates across Europe and Asia due to higher energy prices. Higher nitrogen prices are driving sales, as witnessed in the last reported quarter. The positive pricing environment is expected to continue moving ahead.
CF Industries also remains committed to boosting shareholders’ value by leveraging strong cash flows. It generated operating cash flows of roughly $2.9 billion and a free cash flow of around $2.2 billion in 2021. The company also paid out dividends worth $260 million in 2021. During the fourth quarter, CF repurchased around 7.5 million shares for $490 million. In November 2021, its board approved a new $1.5-billion share repurchase program.
Earnings estimates for CF Industries have also been going up over the past two months. The Zacks Consensus Estimate for 2022 has increased around 22.1%. The consensus estimate for first-quarter 2022 has also been revised 9.1% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. price-consensus-chart | CF Industries Holdings, Inc. Quote
Stocks to Consider
Some better-ranked stocks in the basic materials space are Univar Solutions Inc. , AdvanSix Inc. (ASIX - Free Report) and Allegheny Technologies Incorporated (ATI - Free Report) .
Univar has a projected earnings growth rate of 18.5% for the current year. The Zacks Consensus Estimate for UNVR's current-year earnings has been revised 34.2% upward in the past 60 days.
Univar beat the Zacks Consensus Estimate for earnings in three of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 30.9%, on average. UNVR has rallied around 56.8% in a year and currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AdvanSix has a projected earnings growth rate of 64.8% for the current year. The Zacks Consensus Estimate for ASIX’s current-year earnings has been revised 58% upward in the past 60 days.
AdvanSix beat the Zacks Consensus Estimate for earnings in three of the trailing four quarters, the average being 23.6%. ASIX has surged 99.3% in a year. The company sports a Zacks Rank #1.
Allegheny, currently carrying a Zacks Rank #1, has an expected earnings growth rate of 661.5% for the current year. The Zacks Consensus Estimate for ATI's earnings for the current year has been revised 45.6% upward in the past 60 days.
Allegheny beat the Zacks Consensus Estimate for earnings in each of the trailing four quarters, the average being 127.2%. ATI has rallied around 33.3% over a year.