Tuesday, September 4, 2012

Mosaic: When Will The Tailwinds Pick Up?

The fertilizer sector appears ready for a breakout year in 2013, as strong crop demand merges with weak production due to the severe drought in the U.S. An earlier article focused on Potash (POT), which reported strong fertilizer demand, yet had recently curtailed production due to a surprising declining demand environment.

Another interesting fertilizer company is The Mosaic Company (MOS). It reported earnings back in July and has a stock approaching breakout levels around $60. The company has a similar focus on potash, but it has a more diverse mix, with a higher revenue base from phosphates.

Mosaic is one of the world's leading producers and marketers of concentrated phosphate and potash crop nutrients.

Not surprisingly, Mosaic was very bullish as well on the earnings call in a similar tone as Potash. The company though has a better balance sheet with $2.8B of net cash, placing it in a stronger position to take advantage of any weakness during the fall.

Read the full article at Seeking Alpha. 


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