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Can CF Industries' Strong Cash Flow Drive More Growth and Returns?
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Key Takeaways
CF generated $496M in operating cash flow in Q1, backed by strong operational execution.
CF returned $1.7B to its shareholders in 2025, including $1.34B in share repurchases.
CF's 2025 free cash flow rose 24% year over year to $1.79B amid strong nitrogen demand.
CF Industries Holdings, Inc. (CF - Free Report) generated healthy cash flows in the first quarter, backed by strong operational performance, strategic execution and supportive nitrogen industry fundamentals. Its net cash provided by operating activities was $496 million for the quarter. Its cash and cash equivalents were roughly $2 billion at the end of the quarter.
Notably, CF generated net cash from operating activities of $2.75 billion and free cash flow of $1.79 billion in 2025, up roughly 21% and 24% year over year, respectively.
CF’s substantial cash flows and strong balance sheet enable it to finance its strategic growth investment, pay down debt and drive shareholder value. CF returned $1.7 billion to its shareholders in 2025. It repurchased 16.6 million shares for $1.34 billion during 2025. Since the commencement of its current $2 billion buyback program in October 2025, CF Industries has bought back 3.6 million shares for around $293 million.
The company is efficiently converting adjusted EBITDA to free cash flow. Its full-year 2025 free cash flow to adjusted EBITDA conversion rate was 62%, outpacing sector averages. The same for the first quarter was 51%.
The company is expected to continue generating significant free cash flow, leveraging its high-margin business, strategic execution and favorable global nitrogen industry dynamics, allowing it to invest in growth opportunities and enhance returns to its shareholders.
Among its peers, Nutrien Ltd. (NTR - Free Report) generated solid cash flows in the first quarter, thanks to higher fertilizer benchmark pricing, increased retail earnings and record potash sales volumes. NTR’s cash provided in operating activities was $851 million in the first quarter. Nutrien generated an operating cash flow of $4 billion for full-year 2025.
The Mosaic Company’s (MOS - Free Report) cash flow from operating activities was $104.2 million in the first quarter, up from $42.9 million a year ago, aided by improved working capital dynamics. Mosaic’s free cash flow was negative $252.6 million, consistent with typical first-quarter seasonality. MOS generated an operating cash flow of $825 million in 2025.
CF’s Price Performance, Valuation & Estimates
CF Industries has gained 22.7% in the past year compared with the Zacks Fertilizers industry’s rise of 4.4%.
Image Source: Zacks Investment Research
From a valuation standpoint, CF is currently trading at a forward 12-month earnings multiple of 7.71, a 36.8% discount relative to the industry average of 12.21X. It carries a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for CF’s 2026 and 2027 earnings implies a year-over-year rise of 87.5% and a decline of 38.9%, respectively. The EPS estimates for 2026 and 2027 have been trending higher over the past 60 days.
Image Source: Zacks Investment Research
CF stock currently carries a Zacks Rank #1 (Strong Buy).
View the Zacks #1 Rank List
Image: Bigstock
Can CF Industries' Strong Cash Flow Drive More Growth and Returns?
Key Takeaways
CF Industries Holdings, Inc. (CF - Free Report) generated healthy cash flows in the first quarter, backed by strong operational performance, strategic execution and supportive nitrogen industry fundamentals. Its net cash provided by operating activities was $496 million for the quarter. Its cash and cash equivalents were roughly $2 billion at the end of the quarter.
Notably, CF generated net cash from operating activities of $2.75 billion and free cash flow of $1.79 billion in 2025, up roughly 21% and 24% year over year, respectively.
CF’s substantial cash flows and strong balance sheet enable it to finance its strategic growth investment, pay down debt and drive shareholder value. CF returned $1.7 billion to its shareholders in 2025. It repurchased 16.6 million shares for $1.34 billion during 2025. Since the commencement of its current $2 billion buyback program in October 2025, CF Industries has bought back 3.6 million shares for around $293 million.
The company is efficiently converting adjusted EBITDA to free cash flow. Its full-year 2025 free cash flow to adjusted EBITDA conversion rate was 62%, outpacing sector averages. The same for the first quarter was 51%.
The company is expected to continue generating significant free cash flow, leveraging its high-margin business, strategic execution and favorable global nitrogen industry dynamics, allowing it to invest in growth opportunities and enhance returns to its shareholders.
Among its peers, Nutrien Ltd. (NTR - Free Report) generated solid cash flows in the first quarter, thanks to higher fertilizer benchmark pricing, increased retail earnings and record potash sales volumes. NTR’s cash provided in operating activities was $851 million in the first quarter. Nutrien generated an operating cash flow of $4 billion for full-year 2025.
The Mosaic Company’s (MOS - Free Report) cash flow from operating activities was $104.2 million in the first quarter, up from $42.9 million a year ago, aided by improved working capital dynamics. Mosaic’s free cash flow was negative $252.6 million, consistent with typical first-quarter seasonality. MOS generated an operating cash flow of $825 million in 2025.
CF’s Price Performance, Valuation & Estimates
CF Industries has gained 22.7% in the past year compared with the Zacks Fertilizers industry’s rise of 4.4%.
From a valuation standpoint, CF is currently trading at a forward 12-month earnings multiple of 7.71, a 36.8% discount relative to the industry average of 12.21X. It carries a Value Score of B.
The Zacks Consensus Estimate for CF’s 2026 and 2027 earnings implies a year-over-year rise of 87.5% and a decline of 38.9%, respectively. The EPS estimates for 2026 and 2027 have been trending higher over the past 60 days.
CF stock currently carries a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.