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CF Industries (CF) Shares Up 19% in 3 Months: Here's Why
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CF Industries Holdings, Inc.’s (CF - Free Report) shares have gained 18.7% over the past three months. The company has also outperformed its industry’s gain of 7% over the same time frame. Moreover, it has topped the S&P 500’s 5.3% rise over the same period.
Let’s take a look at the factors behind this Zacks Rank #3 (Hold) stock’s price appreciation.
Image Source: Zacks Investment Research
What’s Working in CF’s Favor?
While CF Industries is facing headwinds from lower nitrogen prices, it is gaining from healthy nitrogen fertilizer demand in major markets and lower natural gas costs. The company is well-positioned to capitalize on rising nitrogen fertilizer demand in major markets. Higher crop commodity prices are contributing to healthy demand globally.
Demand for nitrogen in North America is expected to be driven by high levels of corn planted acres in the United States and favorable farm economics. Moreover, increased planted corn acres, higher crop prices and healthy farm economics are likely to support urea demand in Brazil. CF also expects demand in India to be driven by the government’s plans to maintain high urea volumes in stock.
Lower natural gas prices will also act in the company’s favor. CF Industries saw a significant decline in natural gas costs in the second quarter of 2023. Average cost of natural gas fell to $2.75 per MMBtu in the second quarter of 2023 from $7.05 per MMBtu in the year-ago quarter. Lower natural gas costs led to a decline in the company's cost of sales. The benefits of reduced gas costs are expected to continue in the third quarter.
CF Industries also remains committed to boosting shareholders’ value by leveraging strong cash flows. Net cash provided by operating activities was $712 million in the second quarter. During the first half of 2023, the company repurchased 3.1 million shares for $205 million, which included the purchase of 2 million shares for $130 million in the second quarter.
Better-ranked stocks worth a look in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , Hawkins, Inc. (HWKN - Free Report) and Akzo Nobel N.V. (AKZOY - Free Report) .
The Zacks Consensus Estimate for current fiscal-year earnings for CRS is currently pegged at $3.48, implying year-over-year growth of 205.3%. Carpenter Technology currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carpenter Technology has a trailing four-quarter earnings surprise of roughly 10%, on average. The stock has rallied around 99% in a year.
Hawkins currently carrying a Zacks Rank #1. It has a projected earnings growth rate of 18.9% for the current year.
Hawkins has a trailing four-quarter earnings surprise of roughly 25.6%, on average. HWKN shares are up around 69% in a year.
Akzo Nobel currently carries a Zacks Rank #1. The Zacks Consensus Estimate for AKZOY's current-year earnings has been revised 2.9% upward over the past 60 days.
The Zacks Consensus Estimate for current fiscal-year earnings for Akzo Nobel is currently pegged at $1.44, implying year-over-year growth of 67.4%. AKZOY shares have gained around 32% in a year.
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CF Industries (CF) Shares Up 19% in 3 Months: Here's Why
CF Industries Holdings, Inc.’s (CF - Free Report) shares have gained 18.7% over the past three months. The company has also outperformed its industry’s gain of 7% over the same time frame. Moreover, it has topped the S&P 500’s 5.3% rise over the same period.
Let’s take a look at the factors behind this Zacks Rank #3 (Hold) stock’s price appreciation.
Image Source: Zacks Investment Research
What’s Working in CF’s Favor?
While CF Industries is facing headwinds from lower nitrogen prices, it is gaining from healthy nitrogen fertilizer demand in major markets and lower natural gas costs. The company is well-positioned to capitalize on rising nitrogen fertilizer demand in major markets. Higher crop commodity prices are contributing to healthy demand globally.
Demand for nitrogen in North America is expected to be driven by high levels of corn planted acres in the United States and favorable farm economics. Moreover, increased planted corn acres, higher crop prices and healthy farm economics are likely to support urea demand in Brazil. CF also expects demand in India to be driven by the government’s plans to maintain high urea volumes in stock.
Lower natural gas prices will also act in the company’s favor. CF Industries saw a significant decline in natural gas costs in the second quarter of 2023. Average cost of natural gas fell to $2.75 per MMBtu in the second quarter of 2023 from $7.05 per MMBtu in the year-ago quarter. Lower natural gas costs led to a decline in the company's cost of sales. The benefits of reduced gas costs are expected to continue in the third quarter.
CF Industries also remains committed to boosting shareholders’ value by leveraging strong cash flows. Net cash provided by operating activities was $712 million in the second quarter. During the first half of 2023, the company repurchased 3.1 million shares for $205 million, which included the purchase of 2 million shares for $130 million in the second quarter.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. price-consensus-chart | CF Industries Holdings, Inc. Quote
Stocks to Consider
Better-ranked stocks worth a look in the basic materials space include Carpenter Technology Corporation (CRS - Free Report) , Hawkins, Inc. (HWKN - Free Report) and Akzo Nobel N.V. (AKZOY - Free Report) .
The Zacks Consensus Estimate for current fiscal-year earnings for CRS is currently pegged at $3.48, implying year-over-year growth of 205.3%. Carpenter Technology currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Carpenter Technology has a trailing four-quarter earnings surprise of roughly 10%, on average. The stock has rallied around 99% in a year.
Hawkins currently carrying a Zacks Rank #1. It has a projected earnings growth rate of 18.9% for the current year.
Hawkins has a trailing four-quarter earnings surprise of roughly 25.6%, on average. HWKN shares are up around 69% in a year.
Akzo Nobel currently carries a Zacks Rank #1. The Zacks Consensus Estimate for AKZOY's current-year earnings has been revised 2.9% upward over the past 60 days.
The Zacks Consensus Estimate for current fiscal-year earnings for Akzo Nobel is currently pegged at $1.44, implying year-over-year growth of 67.4%. AKZOY shares have gained around 32% in a year.