24/7 Wall St. » MOS

Fertilizer Maker Makes Hay on Nitrogen (AGU, CF, POT, MOS, MON)

Paul Ausick — Wed, 09 May 2012 12:33:28 +0000

Getting any respect in the fertilizer business has been pretty tough so far this year. We’ll have to wait about an hour or so this morning to see if Agrium Corp. (NYSE: AGU) can defy history. The company reported first quarter results this morning, posting adjusted EPS of $1.32 on revenues of $3.63 billion. Analysts were expecting EPS of $0.99 on revenue of $2.98 billion.

Agrium attributed its increased sales to higher volumes and higher prices for nitrogen. Last week, CF Industries Holdings Inc. (NYSE: CF) also blasted through estimates, but the company’s best seller was also its nitrogen products. Potash Corp. of Saskatchewan Inc. (NYSE: POT) missed earnings estimates on lower potash sales and margins (gross margins fell -56% year-over-year). The Mosaic Co. (NYSE: MOS) also missed on earnings as potash volumes fell and phosphate costs rose. Monsanto Co. (NYSE: MON) pounded EPS estimates, but analysts believe that sales were all pulled forward due to the warm weather.

Agrium and CF are less dependent on potash and phosphates than are the others, and the rise in nitrogen is directly related to its ability to boost yields on the same amount of acreage. Potash fertilizer is needed to ensure healthy plants, but its contribution yields is less important.

Whether demand for nitrogen will continue through the Northern Hemisphere’s growing season remains to be seen, but as more people demand more food on the same amount of acreage, sales and margins on nitrogen are likely to keep pace.

The catch in Agrium’s results is that the company’s first half adjusted EPS guidance is a relatively weak $5.50-$6.10. Analysts had been expecting $5.67 before today’s blowout number. Investors are likely to interpret the lowish guidance as an indication that Agrium’s sales were also pulled forward into the first quarter.

Shares of Agrium are trading up about 0.13% at $84.68 in a 52-week range of $60.15-$93.49.

Paul Ausick

Filed under: Agriculture, Earnings, Food, Pre-Market Activity Tagged: AGU, CF, MON, MOS, POT

Potash Sales & Demand Remain Weaker Longer (POT, MOS)

Administrator — Thu, 26 Apr 2012 11:42:10 +0000

Potash Corp. of Saskatchewan, Inc. (NYSE: POT) appears to have the fertilizer and potash sector off to some concerns during earnings season. The culprit appears to be weaker than expected demand followed by soft pricing. While shares had been weak ahead of earnings, selling is the trend.

Earnings came in at $0.56 EPS versus Thomson Reuters expectations of $0.63 EPS. The drop was 33% in raw earnings based on lower sales and volumes meeting higher operating costs per output unit. The company’s CEO noted that demand has taken longer to surface than it originally expected earlier this year, but he does expect that demand will accelerate through the rest of 2012. Weaker potash prices have been seen based on lower demand and based on higher competition.

As far as guidance for the second quarter, the company sees earnings in a range of $0.90 to $1.10 EPS against estimates of $1.07 EPS. The company is also lowering its fiscal 2012 annual earnings target to $3.20 to $3.60 per share from a prior range offered of $3.40 to $4.00 in earnings per share. The top of the range is now under the $3.61 or so consensus target.

Potash Corp. (NYSE: POT) shares are indicated down about 2.3% at $43.25 against a 52-week range of $38.42 to $62.60 and the weakness appears to be elsewhere in competitors. The Mosaic Company (NYSE: MOS) has not traded but the bid/ask range is indicated lower than the $53.20 close and its stock has been weak as well.

JON C. OGG

Filed under: Agriculture, Earnings Tagged: MOS, POT

More Dividend Hikes On The Way (DOW, MOS, TOO, TGP, FUL, GOOG)

Administrator — Fri, 13 Apr 2012 11:44:27 +0000

The trend of higher dividends is not over and we should expect more dividend hike announcements elsewhere this earnings season. After the close on Thursday came word that Dow Chemical Company (NYSE: DOW) and also from The Mosaic Co. (NYSE: MOS). Other hikes came from Teekay Offshore Partners L.P. (NYSE: TOO), Teekay LNG Partners L.P. (NYSE: TGP), and H.B. Fuller Company (NYSE: FUL). Google Inc. (NASDAQ: GOOG) is listed in the dividend news but the reality is a bit different.

Dow Chemical Company (NYSE: DOW) reported that it was lifting its dividend by a sharp 28% to $0.32 per quarter from a prior payout of $0.25 per quarter. Based upon the $32.67 closing bell, the new yield is now going to be about 3.9%.

The Mosaic Co. (NYSE: MOS) is still a relatively low dividend yield but the potash and fertilizers player is trying to get its payouts higher now that it has less and less influence held by the Cargill Trusts. Its hike went up 150% to $0.125 from $0.05 per quarter. The prior dividend yield will go from almost 0.4% up to just under 1.0% based upon a $51.17 closing price on Thursday.

Teekay Offshore GP LLC, the general partner of Teekay Offshore Partners L.P. (NYSE: TOO) declared a cash distribution of $0.5125 per unit for the last quarter, an increase of $0.0125 or 2.5 percent from the previous quarter.

Teekay GP LLC, the general partner of Teekay LNG Partners L.P. (NYSE: TGP) declared a cash distribution of $0.675 per unit for the quarter ended March 31, 2012, up $0.045 or about 7 percent per unit from the previous quarter.

H.B. Fuller Company (NYSE: FUL) announced after the close on Thursday that it would increase its quarterly dividend from $0.075 to $0.085 per share of common stock for a 13% dividend increase. The new yield is about 1.05%.

Google Inc. (NASDAQ: GOOG) is being represented as a stock dividend, but this is a share structure change that is effectively a two-for-one stock split.

JON C. OGG

Filed under: Dividend Tagged: DOW, FUL, GOOG, MOS, TGP, TOO

Monsanto Posts Big Numbers (MON, MOS, POT, CF, AGU)

Paul Ausick — Wed, 04 Apr 2012 13:09:01 +0000

Seed and fertilizer maker Monsanto Co. (NYSE: MON) reported second fiscal quarter earnings this morning that set a record for the quarter. The company also boosted its EPS outlook for the full fiscal year.

Monsanto, along with Mosaic Co. (NYSE: MOS), Potash Corp. of Saskatchewan Inc. (NYSE: POT), CF Industries Inc. (NYSE: CF), and Agrium Inc. (NYSE: AGU), has seen its share price rise steadily since the first of the year. Agrium and CF Industries are up around 30% year-to-date, while Monsanto is up about 17%, Potash Corp. up about 12%, and Mosaic up more than 4%.

Monsanto reported second quarter revenue of $4.75 billion compared with a consensus estimate of $4.53 and EPS of $2.24 compared with a consensus estimate of $2.12. The company also guided full-year EPS to $3.49-$3.54, slightly better than the consensus estimate of $3.51. The company’s CEO predicted continuing growth:

We’ve seen contributions from growth across crops and geographies, which position us well to deliver high-teens ongoing earnings growth this year

The company’s seeds and genomics business posted revenue of $3.9 billion, up $503 million from the same period a year ago. Monsanto attributed the increase to its sales of corn seed, particularly in the US. The company’s fertilizer business grew from $710 million in the second quarter a year ago to $824 million this year.

Shares of Monsanto are up about 1.6% in the pre-market at $83.09 in a 52-week range of $58.89-$83.95.

Paul Ausick

Filed under: Agriculture, Commodities, Earnings, Food Tagged: AGU, CF, MON, MOS, POT

24/7 Wall St. Closing Bell (AMZN, APOL, HFC, LVS, VZ, MOS, RHT, SN, SHAW, BBY, MY, RIMM, FINL, PHM, CHTP, MM)

Paul Ausick — Thu, 29 Mar 2012 20:05:55 +0000

Markets opened lower this morning but fought back on the day. This morning’s report new unemployment benefits claims tamped down enthusiasm among investors (our coverage here). US natural gas inventories rose much more than expected (our coverage here) and a promise from the IEA to be ready with another release from national strategic oil reserves hit energy stocks hard (more coverage here). The US dollar index rose today, now up 0.08% at 79.186. Commodities were virtually all lower on the stronger dollar. WTI crude oil closed down about -2.5% at $102.78/barrel, and Brent crude trades down -1.51% at $122.28/barrel. Gold settled down -0.3% today, at $1,652.20/ounce.

The unofficial closing bells put the DJIA up nearly 20 points to 13,145.51, the NASDAQ fell by 9.6 points to 3,095.36, and the S&P 500 fell 2.29 to 1,403.26.

There were several analyst upgrades and downgrades today, including Amazon.com Inc. (NASDAQ: AMZN) started as ‘buy’ at ThinkEquity; Apollo Group Inc. (NASDAQ: APOL) cut to ‘hold’ at Argus; HollyFrontier Corp. (NYSE: HFC) cut to ‘neutral’ at Credit Suisse; Las Vegas Sands (NYSE: LVS) reiterated as ‘buy’ and price target raised to $65-$67 at BofA/ML; and Verizon Communications (NYSE: VZ) cut to ‘neutral’ at Baird.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Mosaic Co. (NYSE: MOS) is down -4.7% at $55.49; Red Hat Inc. (NYSE: RHT) is up 18.7% at $61.02 after posting a new 52-week high of $61.37 earlier today (more coverage here); Sanchez Energy Corp. (NYSE: SN) is down -2.5% at $22.01; Shaw Group Inc. (NYSE: SHAW) is up 3.9% at 32.05; and Best Buy Co. Inc. (NYSE: BBY) is down -6.6% at $24.86 (more coverage here). After markets close today China Ming Yang Power Group Ltd. (NYSE: MY), Research in Motion (NASDAQ: RIMM) (our coverage here), and Finish Line Inc. (NASDAQ: FINL) will report earnings.

Other standouts from today include the following stocks:

PulteGroup Inc. (NYSE: PHM) is down -2.5% at $9.24. The homebuilder was downgraded to ‘strong sell’ at S&P Capital IQ. More coverage here.

Chelsea Therapeutics International Ltd. (NASDAQ: CHTP) is down more than -28% at $2.63. The FDA rejected the company’s low blood pressure drug. More coverage here.

Millennial Media Inc. (NYSE: MM) concluded its IPO today at $24.74, up from the initial price of $13/share. Shares traded as high as $27.90 earlier in the day. More coverage of the recent IPO market here.

Stay tuned for Friday. We have also noted the following events on the schedule (all times Eastern):

8:30 a.m. – Personal income and spending report
9:45 a.m. – Chicago purchasing managers’ index
9:55 a.m. – Reuters/University of Michigan consumer sentiment index

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AMZN, APOL, BBY, CHTP, FINL, HFC, LVS, MM, MOS, MY, PHM, RHT, RIMM, SHAW, SN, VZ

Mosaic Shows Huge Decline In Earnings & Margin (MOS)

Administrator — Wed, 28 Mar 2012 20:25:54 +0000

The Mosaic Company (NYSE: MOS) has posted its third quarter earnings, and the results show some serious declines in operating income and in margins. Net earnings fell to $273 million from $542 million a year ago due to lower potash volumes and higher phosphate raw material costs. Earnings per share fell to $0.64 in the quarter from $1.21 in the same quarter last year, although earnings were negatively impacted by notable items totaling $0.08 per share mostly tied to foreign currency transaction losses.

Mosaic’s net sales were flat at $2.2 billion in the third quarter as growth in phosphate sales was offset by declines in potash sales. Thomson Reuters had sales targeted at $2.5 billion.

The company report showed that the quarter’s gross margin was down to $522 million, or 24% of net sales, but that is down from $854 million and down from 39% of net sales from a year ago due mostly to lower potash volumes and higher phosphate raw material costs.

Cash flow provided by operating activities in the third quarter of fiscal 2012 was $405 million compared to $366 million in the prior year, and the company’s cash and cash equivalents were $3.2 billion and long-term debt was $1.0 billion as of February 29, 2012.

Mosaic shares closed down 0.6% at $58.22 and shares are indicated down around $58.00 in the after-hours.

JON C. OGG

Filed under: Agriculture, Earnings Tagged: MOS

24/7 Wall St. Closing Bell (DTV, KMI, VZ, WTW, NVDA, CBK, SNX, FDO, JOSB, MOS, RHT, SN, BBY, SHAW, CMC, AMLN, VRML)

Paul Ausick — Wed, 28 Mar 2012 20:04:46 +0000

Markets opened nearly flat this morning but took a dive early and have muddled along the rest of the day in negative territory. This morning’s report on falling durable goods orders got things off on the wrong foot (our coverage here). The US crude oil commercial inventory grew by a larger-than-expected amount, pushing crude prices down significantly (our coverage here). The US dollar index rose today, now up 0.12% at 79.140. Commodities were mostly lower on the stronger dollar. WTI crude oil closed down about -1.9% at $105.41/barrel, and Brent crude trades down -1.09% at $124.17/barrel. Gold settled down -1.6% today, at $1,657.90/ounce.

The unofficial closing bells put the DJIA down nearly 72 points to 13,126.06 (-0.54%), the NASDAQ fell more than 15 points (-0.49%) to 3,104.96, and the S&P 500 fell -0.49% or nearly 7 points to 1,405.54.

There were several analyst upgrades and downgrades today, including DirecTV Inc. (NASDAQ: DTV) raised to ‘buy’ at Citigroup and reiterated as ‘buy’ at Canaccord Genuity; Kinder Morgan Inc. (NYSE: KMI) started as ‘equal weight’ at Morgan Stanley; Verizon Communications Inc. (NYSE: VZ) cut to ‘sector perform’ at RBC; Weight Watchers International Inc. (NYSE: WTW) started as ‘outperform’ at Credit Suisse; and Nvidia Corp. (NASDAQ: NVDA) raised to ‘market perform’ at JMP Securities.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Christopher & Banks Corp. (NYSE: CBK) is down -13% at $2.05 after posting a new 52-week low of $1.85 earlier today; Synnex Corp. (NYSE: SNX) is down -13% at $37.94 (more coverage here); Family Dollar Stores Inc. (NYSE: FDO) is up 0.6% at $58.58 (more coverage here); and Jos. A. Banks Clothiers Inc. (NASDAQ: JOSB) is down -8.7% at $49.77 (more coverage here). After markets close today the Mosaic Co. (NYSE: MOS), Red Hat Inc. (NYSE: RHT), and Sanchez Energy Corp. (NYSE: SN) will report earnings. Before the markets open in the morning, we’ll get earnings from Best Buy Co. Inc. (NYSE: BBY) and Shaw Group Inc. (NYSE: SHAW).

Other standouts from today include the following stocks:

Commercial Metals Corp. (NYSE: CMC) is up 0.49%. The steel and metal fabricator posted better-than-expected earnings this morning. More coverage here.

Amylin Pharmaceuticals Inc. (NASDAQ: AMLN) is up more than 53%. The drug maker rejected a takeover bid. More coverage here.

Vermillion Inc. (NASDAQ: VRML) is up 19%. The drug maker received a patent approval today. More coverage here.

Stay tuned for Wednesday. Fed Chairman Ben Bernanke, Atlanta Fed President Dennis Lockhart, Philadelphia Fed President Charles Plosser, and Richmond Fed President Jeffrey Lacker are giving speeches. We have also noted the following events on the schedule (all times Eastern):

8:30 a.m. – New unemployment benefits claims
8:30 a.m. – Corporate profits
10:30 a.m. – EIA natural gas storage report
11:00 a.m. – Kansas City Fed manufacturing index

Paul Ausick

Filed under: Analyst Calls, HI/LOW, Market Close Tagged: AMLN, BBY, CBK, CMC, DTV, FDO, JOSB, KMI, MOS, NVDA, RHT, SHAW, SN, SNX, VRML, VZ, WTW

24/7 Wall St. Closing Bell (MU, ATVI, BAC, SCCO, APOL, GOL, WAG, LEN, CBK, SNX, FDO, MOS, ISTA, OPXT, OCLR, HOGS)

Paul Ausick — Tue, 27 Mar 2012 20:05:41 +0000

Markets opened slightly higher this morning but have been wobbling around the neutral line for the whole day. This morning’s report on the decline of housing prices (our coverage here) and the drop in US consumer confidence has kept buyers in check (our coverage here). There was little other news sufficient to move the markets today. The US dollar index rose today, now up 0.14% at 79.091. Commodities were mixed on the dollar strength, with wheat taking the biggest decline. WTI crude oil closed up 0.3% at $107.33/barrel, and Brent crude trades down -0.34% at $125.22/barrel. Gold settled down less than -0.1% today, at $1,684.90/ounce.

The unofficial closing bells put the DJIA down nearly 44 points to 13,197.96 (-0.33%), the NASDAQ fell more than 2 points (-0.07%) to 3,120.35, and the S&P 500 fell -0.28% or nearly 4 points to 1,412.52.

There were several analyst upgrades and downgrades today, including Micron Technology Inc. (NASDAQ: MU) started as ‘buy’ at Jefferies; Activision Blizzard Inc. (NASDAQ: ATVI) started as ‘buy’ at Stifel Nicolaus; Bank of America Corp. (NYSE: BAC) cut to ‘neutral’ at Baird; Southern Copper Corp. (NYSE: SCCO) raised to ‘overweight’ at Morgan Stanley; and Apollo Group Inc. (NASDAQ: APOL) cut to ‘neutral’ at Credit Suisse.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Apollo Group Inc. is down -8.6% at $39.48; Gol Linhas Aereas Inteligentes SA (NYSE: GOL) is up 2.7% at $7.32; Walgreen Co. (NYSE: WAG) is up 1.3% at $34.80; and Lennar Corp. (NYSE: LEN) is up 4.7% at $27.65 after posting a new 52-week high earlier today of $28.28 (more coverage here and here). After markets close today Christopher & Banks Corp. (NYSE: CBK) and Synnex Corp. (NYSE: SNX) will report earnings. Before the markets open in the morning, we’ll get earnings from Family Dollar Stores Inc. (NYSE: FDO) and the Mosaic Co. (NYSE: MOS).

Other standouts from today include the following stocks:

ISTA Pharmaceuticals Inc. (NASDAQ: ISTA) is up 7.9% at $9.04. The drug company is being acquired. More coverage here.

Opnext Inc. (NASDAQ: OPXT) is up more than 53% at $1.73. The optical equipment maker is merging with Oclaro Inc. (NASDAQ: OCLR). More coverage here.

Zhongpin Inc. (NASDAQ: HOGS) is up nearly 25% at $11.51. The Chinese food processing company has received a preliminary offer to be taken private. More coverage here.

Stay tuned for Wednesday. St. Louis Fed President James Bullard is giving a speech. We have also noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Bankers’ Association purchase applications
8:30 a.m. – Durable goods orders
10:30 a.m. – EIA weekly petroleum status report
1:00 p.m. – 5-year note auction

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: APOL, ATVI, BAC, CBK, FDO, GOL, HOGS, ISTA, LEN, MOS, MU, OCLR, OPXT, SCCO, SNX, WAG

Top Earnings Previews for the Week Ahead (APOL, GOL, LEN, PVH, WAG, CMC, FDO, MOS, PAYX, RHT, SN, TEA, BBY, PBY, RIMM)

Administrator — Fri, 23 Mar 2012 15:15:02 +0000

Earnings season is all but over and only the tail end of the quarterly and off-calendar reporting outfits are still reporting earnings. Still, the coming week does have several key earnings reports coming down the pipe.

We are offering previews and adding color if applicable on the following companies: Apollo Group Inc. (NASDAQ: APOL); GOL Linhas Aereas Inteligentes S.A. (NYSE: GOL); Lennar Corporation (NYSE: LEN); PVH Corporation (NYSE: PVH); Walgreen Co. (NYSE: WAG); Commercial Metals Co. (NYSE: CMC); Family Dollar Stores Inc. (NYSE: FDO); The Mosaic Co. (NYSE: MOS); Paychex Inc. (NASDAQ: PAYX); Red Hat Inc. (NYSE: RHT); Sanchez Energy Corporation (NYSE: SN); Teavana Holdings Inc. (NYSE: TEA); Best Buy Co. Inc. (NYSE: BBY); Pep Boys-Manny Moe & Jack (NYSE: PBY); and Research In Motion Ltd. (NASDAQ: RIMM).

Monday , March 26

Apollo Group Inc. (NASDAQ: APOL): Thomson Reuters has estimates of $0.37 EPS and $932.8 million in revenues. Shares of the online university at around $42.50 and the 52-week range is $37.08 to $58.29.

GOL Linhas Aereas Inteligentes S.A. (NYSE: GOL) is expected to report earnings of $0.07 EPS on a translated basis from Brazilian Reals for the Latin American airline outfit. A slowing Brazil story has not helped GOL out and at $7.50 the 52-week trading range is $5.03 to $14.35.

Tuesday, March 27

Lennar Corporation (NYSE: LEN) was soft after weaker than expected new home sales data for February, but the homebuilder is up over 100% from the lows of 2011. At $25.75, the 52-week range is $12.14 to $27.07. Thomson Reuters has estimates of $0.04 EPS and $699.4 million in revenues.

PVH Corporation (NYSE: PVH): Thomson Reuters has estimates of $1.09 EPS and $1.5 billion in revenues. Ay $88.40, shares are very close to the highs with its 52-week range of $51.15 to $90.64.

Walgreen Co. (NYSE: WAG) has not been a big performer of late and the $33.50 handle today compares to a 52-week range of $30.34 to $45.34. Thomson Reuters has estimates of $0.77 EPS and $18.56 billion in revenues.

Filed under: 24/7 Wall St. Wire, Calendar, Earnings, Economy, The Week Tagged: APOL, BBY, CMC, FDO, GOL, LEN, MOS, PAYX, PBY, PVH, RHT, RIMM, SN, TEA, WAG

Potash Fertilizer Makers Get Bump on US Planting Estimates (POT, MOS, CF)

Paul Ausick — Fri, 16 Mar 2012 17:03:39 +0000

US plantings of wheat and corn this year will be higher than the most recent US Department of Agriculture survey according to new survey results from Allendale Inc. cited by Bloomberg News. The firm forecasts that corn planting will rise to more than 95 million acres, higher than last year’s total of 91.9 million acres and higher than last month’s USDA forecast of 94 million acres. Wheat planting will rise to nearly 57 million acres.

Potash fertilizer makers are getting a nice share-price bump on the news, with Potash Corp. of Saskatchewan (NYSE: POT) rising more than 5.5%, Mosaic Co. (NYSE: MOS) up about 4.25%, and CF Industries Holdings Inc. (NYSE: CF) up about 2.35%.

Shares of Potash Corp. and Mosaic are down about -17% and -24%, respectively, over the past 12 months. CF Industries’ shares are up about 46% in the same period, mostly on the strength of the demand for nitrogen fertilizer.

Filed under: Agriculture, Commodities, Food Tagged: CF, MOS, POT