Group 1 - The analyst has over 10 years of experience researching more than 1000 companies across various sectors including commodities and technology [1] - The focus of the research includes metals and mining stocks, as well as other industries such as consumer discretionary, staples, REITs, and utilities [1] Group 2 - The analyst has transitioned from writing a blog to creating a value investing-focused YouTube channel, where extensive research on hundreds of companies has been conducted [1]

Core Viewpoint - CF Industries Holdings, Inc. has successfully shipped certified low-carbon ammonia from its facility in Donaldsonville, Louisiana, marking a significant step in the production and supply of sustainable ammonia [1] Company Summary - CF Industries is recognized as the world's largest producer of ammonia, highlighting its leading position in the industry [1] Industry Summary - The low-carbon ammonia shipped is intended for use in the production of low-carbon caprolactam by Envalior, indicating a growing trend towards sustainable materials in engineering [1] - Trafigura, a key player in the global commodities market, purchased 23,500 metric tons of the low-carbon ammonia, showcasing the demand for sustainable products [1]

Core Points - CF Industries Holdings, Inc. has declared a quarterly dividend of $0.50 per share, payable on November 28, 2025, to stockholders of record as of November 14, 2025 [1] - The company will report its third quarter and nine months 2025 results after market close on November 5, 2025, with a conference call scheduled for November 6, 2025, at 11:00 a.m. ET [2] - Investors can access the conference call via phone or through the company's website, with a replay available post-event [3] Company Overview - CF Industries is focused on providing clean energy solutions, aiming to decarbonize its ammonia production network to support low-carbon hydrogen and nitrogen products for various applications [4] - The company operates manufacturing complexes in the U.S., Canada, and the U.K., supported by a robust storage, transportation, and distribution network in North America [4]

Company Overview - CF Industries Holdings, Inc. is based in Northbrook, Illinois, and specializes in manufacturing and selling hydrogen and nitrogen products for various applications including energy, fertilizer, and emissions abatement, with a market cap of $13.8 billion [1] Market Position - CF Industries is classified as a large-cap stock, with its market cap exceeding $10 billion, highlighting its size and influence in the agricultural inputs industry [2] - The company benefits from scale, integration, and cost leadership in nitrogen fertilizer production, supported by efficient manufacturing and access to natural gas [2] - CF's strategic geographic footprint and commitment to operational excellence and sustainability enhance its competitive advantage, allowing for efficient distribution and responsiveness to demand fluctuations [2] Stock Performance - CF's stock has declined 18% from its 52-week high of $104.45, reached on June 16, and has underperformed the S&P 500 Index, which gained 12.2% over the same three-month period [3][4] - Year-to-date, CF shares have risen marginally and increased 4.9% over the past 52 weeks, underperforming the S&P 500's year-to-date gains of 13.8% and 17.4% returns [4] Recent Financial Results - In Q2, CF reported an EPS of $2.37, exceeding Wall Street expectations of $2.35, and revenue of $1.9 billion, surpassing forecasts of $1.7 billion [5] - Despite these results, CF's stock closed down more than 3% following the earnings report [5] Competitive Landscape - The Mosaic Company has outperformed CF, showing a 36% increase year-to-date and 30.8% returns over the past 52 weeks [5] Analyst Sentiment - Wall Street analysts maintain a cautious outlook on CF, with a consensus "Hold" rating from 17 analysts and a mean price target of $93.33, indicating a potential upside of 9% from current levels [6]

Company Overview - CF Industries is the world's largest ammonia producer with a production capacity of 10.5 million tons per year [1] - The company primarily produces anhydrous ammonia, granular urea, urea ammonium nitrate, and ammonium nitrate products [1] Industry Context - Ammonia is a key ingredient for fertilizer, highlighting the importance of CF Industries in the agricultural sector [1] Leadership - Laura Starks is the founder and CEO of Starks Energy Economics, LLC, with a background in chemical engineering and an MBA focused on finance [1] - Starks has extensive experience in investing and analyzing energy companies across various sectors, including utilities and oil and natural gas [1]

Group 1: Green Dot Corporation (GDOT) - Green Dot Corporation is a financial technology and bank holding company with a Zacks Rank 1 [1] - The Zacks Consensus Estimate for its current year earnings has increased by 10.7% over the last 60 days [1] - The company has a price-to-earnings ratio (P/E) of 9.98, compared to the industry average of 17.40, and possesses a Value Score of A [1] Group 2: CF Industries Holdings, Inc. (CF) - CF Industries is a global leader in nitrogenous fertilizers and other nitrogen products, also carrying a Zacks Rank 1 [2] - The Zacks Consensus Estimate for its current year earnings has increased by 18.1% over the last 60 days [2] - The company has a price-to-earnings ratio (P/E) of 10.68, compared to the industry average of 11.30, and possesses a Value Score of A [2] Group 3: First Financial Bancorp. (FFBC) - First Financial Bancorp. is a bank holding company for First Financial Bank, holding a Zacks Rank 1 [3] - The Zacks Consensus Estimate for its current year earnings has increased by 6.1% over the last 60 days [3] - The company has a price-to-earnings ratio (P/E) of 9.53, compared to the industry average of 11.30, and possesses a Value Score of B [3]

Core Viewpoint - CF Industries (CF) has experienced a significant downtrend, with a stock decline of 17.6% over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to improved earnings expectations from analysts [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is a key technical indicator used to identify oversold conditions, with a reading below 30 typically indicating that a stock is oversold [2]. - CF's current RSI reading is 28.91, indicating that the heavy selling pressure may be exhausting, which could lead to a price rebound as the stock seeks to return to its previous equilibrium [5]. Group 2: Fundamental Analysis - There is a strong consensus among sell-side analysts that CF's earnings estimates for the current year are being revised upward, with a 4.2% increase in the consensus EPS estimate over the last 30 days, which often correlates with price appreciation [6]. - CF holds a Zacks Rank 1 (Strong Buy), placing it in the top 5% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises, further supporting the potential for a near-term turnaround [7].

PART I [Item 1. Financial Statements (unaudited)](index=3&type=section&id=Item%201%2E%20Financial%20Statements%20%28unaudited%29) This section presents the unaudited consolidated financial statements for the quarterly and six-month periods ended June 30, 2025, and 2024, covering operations, balance sheets, cash flows, and detailed notes [Consolidated Statements of Operations](index=3&type=section&id=Consolidated%20Statements%20of%20Operations) The company's net sales increased to $1.89 billion for the three months ended June 30, 2025, up from $1.57 billion in the same period of 2024, while net earnings attributable to common stockholders decreased slightly to $386 million Consolidated Statements of Operations Highlights (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Net sales** | $1,890 | $1,572 | $3,553 | $3,042 | | **Gross margin** | $755 | $679 | $1,327 | $1,088 | | **Operating earnings** | $648 | $638 | $1,103 | $941 | | **Net earnings attributable to common stockholders** | $386 | $420 | $698 | $614 | | **Diluted EPS** | $2.37 | $2.30 | $4.20 | $3.31 | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets stood at $13.75 billion, with cash and cash equivalents increasing to $1.69 billion, and total equity growing to $7.82 billion primarily due to noncontrolling interests Consolidated Balance Sheet Highlights (in millions) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $1,686 | $1,614 | | **Total current assets** | $2,676 | $2,520 | | **Total assets** | $13,750 | $13,466 | | **Long-term debt** | $2,973 | $2,971 | | **Total liabilities** | $5,929 | $5,874 | | **Total stockholders' equity** | $4,963 | $4,985 | | **Noncontrolling interests** | $2,858 | $2,607 | | **Total equity** | $7,821 | $7,592 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities increased to $1.15 billion, while net cash used in investing activities rose significantly to $368 million due to higher capital expenditures Consolidated Cash Flow Summary (in millions) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $1,149 | $920 | | **Net cash used in investing activities** | $(368) | $(134) | | **Net cash used in financing activities** | $(733) | $(998) | | **Increase (decrease) in cash** | $72 | $(213) | [Notes to Unaudited Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on accounting policies and financial statement line items, including revenue breakdowns, the Blue Point joint venture, and share repurchase activity Revenue by Geography (in millions) | Region | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **North America** | $1,686 | $1,366 | $3,059 | $2,626 | | **Europe and other** | $204 | $206 | $494 | $416 | | **Total revenue** | $1,890 | $1,572 | $3,553 | $3,042 | - A long-term supply contract liability of **$709 million** related to the Waggaman acquisition is being amortized into net sales over 25 years[33](index=33&type=chunk) - In Q1 2025, the company sold its Ince, U.K. facility and recognized a loss of **$23 million**[41](index=41&type=chunk) - On April 8, 2025, the company formed the Blue Point joint venture with JERA and Mitsui for low-carbon ammonia production. CF Holdings holds a **40% interest** but consolidates the entity as the primary beneficiary (VIE)[67](index=67&type=chunk)[70](index=70&type=chunk) - In H1 2025, the company repurchased **8.2 million shares** for **$636 million** under its 2022 Share Repurchase Program[84](index=84&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202%2E%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's performance, strategy focused on decarbonization and clean energy, market conditions, consolidated and segment results, liquidity, and capital plans [Overview of CF Holdings and Strategy](index=24&type=section&id=Overview%20of%20CF%20Holdings%20and%20Strategy) CF Industries outlines its mission to provide clean energy and its strategy to decarbonize its ammonia production network through initiatives like the Donaldsonville CCS project and the Blue Point joint venture - The company's strategy is to leverage its ammonia production leadership to accelerate the transition to clean energy by decarbonizing its existing network and building new low-carbon capacity[100](index=100&type=chunk)[103](index=103&type=chunk) - The Donaldsonville CCS project was completed in July 2025 for approximately **$200 million**, enabling the production of up to **1.9 million tons** of low-carbon ammonia annually[101](index=101&type=chunk) - The Blue Point joint venture will construct a low-carbon ammonia facility with an estimated cost of **$3.7 billion**, with production expected to begin in 2029. CF will also invest approximately **$550 million** in supporting infrastructure[107](index=107&type=chunk)[109](index=109&type=chunk) [Market Conditions and Financial Summary](index=27&type=section&id=Market%20Conditions%20and%20Financial%20Summary) Market conditions in Q2 2025 were characterized by higher nitrogen selling prices, driven by increased global energy costs and supply disruptions, leading to an 11% increase in gross margin despite sharply rising natural gas costs Key Market Drivers (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Average Selling Price (per ton)** | $376 | $322 | +$54 | +17% | | **Sales Volume (million tons)** | 5.0 | 4.9 | +0.1 | +2% | | **Henry Hub Gas Price (per MMBtu)** | $3.16 | $2.04 | +$1.12 | +55% | | **Company Cost of Gas (per MMBtu)** | $3.36 | $1.90 | +$1.46 | +77% | - Q2 2025 gross margin increased by **$76 million (11%)** to **$755 million**, as a **$270 million** benefit from higher selling prices was partially offset by a **$136 million** increase in natural gas costs[131](index=131&type=chunk) [Consolidated Results of Operations Analysis](index=31&type=section&id=Consolidated%20Results%20of%20Operations%20Analysis) For Q2 2025, net sales grew 20% to $1.89 billion driven by higher selling prices, while cost of sales increased 27% due to rising natural gas costs, leading to an 8% decrease in net earnings attributable to common stockholders - Q2 2025 net sales increased by **$318 million (20%)** year-over-year, driven by higher average selling prices (**+$270 million**) and sales volume (**+$48 million**)[144](index=144&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - Q2 2025 cost of sales increased by **$242 million (27%)**, primarily due to a **$136 million** increase in natural gas costs[147](index=147&type=chunk) - For the six months ended June 30, 2025, net sales increased by **$511 million (17%)** and cost of sales increased by **$272 million (14%)**, leading to a **$239 million (22%)** increase in gross margin[142](index=142&type=chunk) [Operating Results by Business Segment Analysis](index=36&type=section&id=Operating%20Results%20by%20Business%20Segment%20Analysis) In Q2 2025, most segments experienced increased gross margins due to higher selling prices offsetting rising natural gas costs, with Granular Urea and UAN gross margins rising 23% and 25% respectively, while Ammonia's gross margin slightly decreased Gross Margin by Segment (in millions) | Segment | Q2 2025 | Q2 2024 | Change | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Ammonia** | $136 | $147 | -7% | $322 | $212 | +52% | | **Granular Urea** | $279 | $227 | +23% | $452 | $381 | +19% | | **UAN** | $270 | $216 | +25% | $412 | $359 | +15% | | **AN** | $25 | $23 | +9% | $41 | $32 | +28% | | **Other** | $45 | $66 | -32% | $100 | $104 | -4% | | **Consolidated** | $755 | $679 | +11% | $1,327 | $1,088 | +22% | [Liquidity and Capital Resources Analysis](index=47&type=section&id=Liquidity%20and%20Capital%20Resources%20Analysis) The company maintained a strong liquidity position with $1.69 billion in cash as of June 30, 2025, continued its capital return program with $636 million in share repurchases, and projects full-year 2025 capital expenditures between $800-$900 million - Cash and cash equivalents stood at **$1.69 billion** as of June 30, 2025, including **$264 million** related to the consolidated Blue Point joint venture[231](index=231&type=chunk) - Consolidated capital expenditures for 2025 are forecasted to be between **$800 million** and **$900 million**, which includes **$300 million** to **$400 million** for the Blue Point JV[239](index=239&type=chunk) - In the first six months of 2025, the company repurchased **8.2 million shares** for **$636 million**. A new **$2 billion** share repurchase program was authorized in May 2025[244](index=244&type=chunk)[245](index=245&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=53&type=section&id=Item%203%2E%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section refers to the company's Annual Report on Form 10-K for detailed market risk information and notes the company held natural gas derivative contracts for 13.6 million MMBtus as of June 30, 2025 - As of June 30, 2025, the company had natural gas derivative contracts for **13.6 million MMBtus** to hedge against price volatility[269](index=269&type=chunk) [Item 4. Controls and Procedures](index=53&type=section&id=Item%204%2E%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting identified despite the implementation of a new system - The principal executive and financial officers concluded that the company's disclosure controls and procedures were effective as of the end of the period[270](index=270&type=chunk) - A new procurement and plant asset management system was implemented in Q2 2025, but no other changes materially affected internal controls over financial reporting[271](index=271&type=chunk) PART II [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=54&type=section&id=Item%202%2E%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section provides a detailed monthly breakdown of the company's share repurchases during the second quarter of 2025, totaling approximately 2.7 million shares Issuer Purchases of Equity Securities (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | **April 2025** | 2,562,542 | $73.27 | | **May 2025** | 93,878 | $79.43 | | **June 2025** | 72,925 | $95.01 | | **Total** | 2,729,345 | $74.06 | [Item 5. Other Information](index=54&type=section&id=Item%205%2E%20Other%20Information) The company reports that no director or officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 [Item 6. Exhibits](index=54&type=section&id=Item%206%2E%20Exhibits) This section lists the exhibits filed with the Quarterly Report on Form 10-Q, including officer certifications and financial data formatted in Inline XBRL

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $1,400,000,000 for the first half of 2025, reflecting strong operational performance amid a tight global nitrogen supply-demand balance [5][18] - Net earnings attributable to common stockholders were $698,000,000 or $4.2 per diluted share for the first half of 2025, compared to $386,000,000 or $2.37 per diluted share for the same period in 2024 [18][19] - Net cash from operations was $2,500,000,000, and free cash flow was $1,700,000,000 for the trailing twelve months [19] Business Line Data and Key Metrics Changes - The company produced 5,200,000 tons of gross ammonia in the first half of 2025, achieving a 99% utilization rate, with an expected total production of approximately 10,000,000 tons for the full year [8][18] - The Donaldsonville carbon capture and sequestration project began operations in July, expected to reduce CO2 emissions by up to 2,000,000 metric tons per year and generate significant returns through tax credits and premium sales of low carbon ammonia [9][20] Market Data and Key Metrics Changes - The global nitrogen supply-demand balance continued to tighten, driven by strong demand in North America and India, alongside low global nitrogen inventories and production disruptions in key supply regions [11][14] - Brazil and India are projected to import over 8,000,000 metric tons of urea by the end of the year, indicating robust global demand [14] Company Strategy and Development Direction - The company is focused on executing strategic initiatives, including the Blue Point joint venture and the Donaldsonville CCS project, to enhance its low carbon ammonia production capabilities [5][10] - The company aims to maintain a balanced capital allocation strategy, investing in growth while returning substantial capital to shareholders, with $2,400,000,000 authorized for share repurchases [19][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to create shareholder value due to favorable global nitrogen industry dynamics and strong operational performance [7][25] - The company anticipates that the global nitrogen supply-demand balance will remain tight in the near and medium term, with ongoing demand for low carbon ammonia expected to further tighten the market [16][25] Other Important Information - The company has returned approximately $2,000,000,000 to shareholders over the last twelve months, including repurchasing more than 10% of its outstanding shares [6][19] - The company is preparing to ship its first cargo of low carbon ammonia from the Donaldsonville project, which is expected to command a premium in the market [16][20] Q&A Session Summary Question: Outlook for returns from the Blue Point joint venture - Management discussed the importance of depreciation and tax credits in calculating returns, indicating that they do not expect significant changes to overall project returns [27][28] Question: Future crop and fertilizer price dynamics - Management acknowledged the disconnect between crop prices and input costs, emphasizing that nitrogen remains a non-discretionary nutrient for farmers [31][35] Question: Inventory and loading issues at the Donaldsonville facility - Management clarified that the report of loading issues was incorrect, attributing low inventory levels to high demand rather than operational problems [38][40] Question: Cost pressures in the first half of the year - Management explained that increased SG&A costs were due to legal fees related to the Blue Point joint venture and adjustments in variable compensation for employees [44][46] Question: Cash flow and uses of cash moving forward - Management indicated that they would likely prioritize share repurchases as cash generation exceeds expectations, while also managing capital expenditures for the Blue Point project [66][67] Question: Impact of geopolitical events on nitrogen prices - Management expressed that ongoing geopolitical tensions would likely maintain high nitrogen prices and limit supply from certain regions [96][99] Question: Expectations for Chinese nitrogen exports - Management noted that while there are exportable tons available from China, the actual volume may be limited due to domestic demand and pricing dynamics [76][78]

Financial Data and Key Metrics Changes - For the first half of 2025, the company reported adjusted EBITDA of $1.4 billion, reflecting strong operational performance amid a tight global nitrogen supply-demand balance [4][15] - Net earnings attributable to common stockholders were $698 million, or $4.2 per diluted share, compared to $386 million, or $2.37 per diluted share in the same period last year [15][18] - Net cash from operations for the trailing twelve months was $2.5 billion, with free cash flow at $1.7 billion [16][18] Business Line Data and Key Metrics Changes - The company produced 5.2 million tons of gross ammonia in the first half of 2025, achieving a 99% utilization rate, with an expected total production of approximately 10 million tons for the full year [7][15] - The Donaldsonville carbon capture and sequestration project began operations in July, expected to reduce CO2 emissions by up to 2 million metric tons per year and generate significant returns through tax credits and premium sales of low carbon ammonia [8][18] Market Data and Key Metrics Changes - The global nitrogen supply-demand balance continued to tighten, driven by strong demand from North America and India, alongside low inventories and production disruptions in key supply regions [9][12] - Brazil and India are projected to import over 8 million metric tons of urea by the end of the year, indicating robust global demand [12][13] Company Strategy and Development Direction - The company is focused on executing strategic initiatives, including the Blue Point joint venture and the Donaldsonville CCS project, to enhance its low carbon ammonia production capabilities [4][8] - The company aims to maintain a balanced capital allocation strategy, investing in growth while returning substantial capital to shareholders, with $2.4 billion authorized for share repurchases [17][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing tight nitrogen supply-demand balance, anticipating robust nitrogen demand in North America despite farmer economics concerns [11][13] - The company expects to generate incremental EBITDA and free cash flow from the Donaldsonville CCS project, projecting over $100 million annually from tax incentives and product premiums [18][19] Other Important Information - The company acknowledged the upcoming retirement of a key executive, Ashraf Malik, and celebrated the 20th anniversary of its IPO, highlighting its growth and operational excellence over the years [20][22] - The company has seen a nearly threefold increase in nitrogen capacity per share since 2010, positioning itself as a global leader in the industry [22] Q&A Session Summary Question: Outlook for returns from the Blue Point joint venture - Management discussed the importance of depreciation and tax credits in return calculations, indicating that they do not expect material changes to overall project returns [25][27] Question: Impact of crop and fertilizer prices on future profitability - Management noted that nitrogen is a non-discretionary nutrient, and farmers will likely optimize yield despite input cost pressures [29][32] Question: Clarification on loading operations at the Donaldsonville facility - Management clarified that there were no operational issues at the facility, attributing low inventory levels to high demand rather than production problems [36][39] Question: Drivers of increased SG&A and controllable costs - Management identified legal fees related to the Blue Point joint venture and adjustments in variable compensation as key drivers of increased SG&A costs [40][42] Question: Cash flow from the carbon capture project - Management explained that cash benefits from tax credits would begin to be realized in the third quarter, with expectations for cash settlements in 2026 [48][52] Question: Supply side dynamics and geopolitical impacts - Management highlighted ongoing geopolitical tensions and gas shortages affecting nitrogen supply, while expressing a positive outlook for demand in the second half of the year [58][63] Question: Future of nitrogen supply and demand balance - Management emphasized that new production capacity is not keeping pace with demand growth, leading to a continued tight market [78][82]