Core Viewpoint - Mosaic (MOS) is positioned as a strong investment opportunity due to its improving earnings outlook and analysts' increasing earnings estimates [1][2]. Earnings Estimate Revisions - The trend of rising earnings estimate revisions reflects growing analyst optimism regarding Mosaic's earnings prospects, which is expected to positively impact its stock price [2]. - For the current quarter, Mosaic is projected to earn $0.74 per share, representing a 37.04% increase from the previous year [6]. - Over the last 30 days, the Zacks Consensus Estimate for the current quarter has increased by 10.53% due to two upward revisions and one downward revision [6]. - For the full year, Mosaic is expected to earn $2.63 per share, indicating a 32.83% increase from the prior year [7]. - The consensus estimate for the current year has risen by 23.6% following four upward revisions with no negative changes [8]. Zacks Rank and Performance - Mosaic has achieved a Zacks Rank of 2 (Buy), indicating favorable conditions for investment based on the positive estimate revisions [9]. - Historically, stocks with a Zacks Rank of 1 (Strong Buy) and 2 (Buy) have significantly outperformed the S&P 500 [9]. - The stock has gained 24.9% over the past four weeks, driven by solid estimate revisions and positive earnings growth prospects [10].

Group 1 - The Mosaic Company (MOS) has launched a new biostimulant product, Neptunion, in China, aimed at helping crops withstand abiotic stresses like drought, salinity, and heat [1] - Neptunion is part of MOS Biosciences' sustainable ag technology product line, which focuses on improving crop yields while reducing environmental impact [2] - The stock of MOS has increased by 9.5% over the past year, slightly outperforming the industry growth of 9.4% [4] Group 2 - For the second quarter, MOS expects Potash segment sales volumes to be between 2.3 million tons and 2.5 million tons, and Phosphate division sales volumes to be projected at 1.7-1.9 million tons, indicating strong global demand [5] - The company anticipates that sales volumes for the Mosaic Fertilizantes unit will be approximately 30% higher in the second quarter compared to the first quarter [5] - The distribution margin is forecasted to remain in the normalized range of $30-$40 per ton annually [5] Group 3 - MOS currently holds a Zacks Rank of 2 (Buy), indicating a favorable outlook compared to other stocks in the Basic Materials sector [6] - Other top-ranked stocks in the same sector include Akzo Nobel N.V. (AKZOY), Newmont Corporation (NEM), and Idaho Strategic Resources, Inc. (IDR), with AKZOY rated as a Strong Buy [6]

Core Insights - The article emphasizes the importance of value investing, which focuses on identifying undervalued companies in the market [2][3] - Zacks has developed a Style Scores system to help investors find stocks with specific traits, particularly in the Value category [3] Company Analysis: The Mosaic Company (MOS) - The Mosaic Company has a Zacks Rank of 2 (Buy) and an A grade for Value, indicating it is among the strongest value stocks currently [3] - MOS has a price-to-book (P/B) ratio of 0.91, which is attractive compared to the industry average of 1.51 [4] - Over the past 52 weeks, MOS's P/B ratio has fluctuated between 0.61 and 0.91, with a median of 0.73 [4] - The price-to-sales (P/S) ratio for MOS is 0.96, compared to the industry's average P/S of 1.44, suggesting it is undervalued [5] Company Analysis: Yara International ASA (YARIY) - Yara International ASA is rated 1 (Strong Buy) with a Value score of A, making it another solid option for value investors [6] - YARIY has a P/B ratio of 1.14, which is below the industry average of 1.51 [6] - The P/B ratio for YARIY has ranged from 0.87 to 1.18 over the past year, with a median of 1.01 [6] Conclusion on Value Stocks - Both The Mosaic Company and Yara International ASA are highlighted as likely undervalued stocks, supported by their strong earnings outlook [7]

Core Insights - Mosaic is a significant player in the agricultural sector and the global food production chain, currently undergoing a transformation process that could establish a strong foundation for future growth [1]. Company Overview - Mosaic operates within the agricultural sector, focusing on key aspects of food production [1]. Investment Potential - The transformation process Mosaic is experiencing may enhance its long-term potential, making it an attractive option for value-focused investors [1].

Company Overview - The Mosaic Company (NYSE: MOS) is a global leader in the production of mineral fertilizers, focusing on phosphorous and potash products [1] - Founded in 2004, the company has achieved significant growth through vertical business integration [1] Industry Position - Mosaic has established itself as a powerful player in the fertilizer industry, leveraging its expertise in mineral production [1] - The company specializes in key agricultural inputs that are essential for crop production, thereby playing a critical role in the global food supply chain [1]

Financial Performance - For the three months ended March 31, 2025, Mosaic reported net sales of $2,620.9 million, a decrease of 2% from $2,679.4 million in the same period of 2024[106]. - Gross margin increased by 22% to $488.4 million for the three months ended March 31, 2025, compared to $399.2 million in the prior year, driven by higher average selling prices in the Phosphates segment[106]. - Operating earnings surged 96% to $338.5 million for the three months ended March 31, 2025, compared to $172.9 million in the prior year[106]. - Net income attributable to Mosaic increased significantly to $238.1 million, or $0.75 per diluted share, compared to $45.2 million, or $0.14 per diluted share, in the prior year[107]. Segment Performance - The Phosphate segment's net sales decreased by 6% to $1,098.6 million for the three months ended March 31, 2025, primarily due to lower finished goods sales volumes[114]. - Average finished product selling price in the Phosphate segment increased by 7% to $632 per tonne for the three months ended March 31, 2025, compared to $593 per tonne in the prior year[115]. - Operating earnings in the Potash segment decreased to $157 million for the three months ended March 31, 2025, down from $198 million in the prior year, primarily due to lower average selling prices and sales volumes[110]. - Operating earnings in the Mosaic Fertilizantes segment increased to $99 million for the three months ended March 31, 2025, compared to $42 million in the prior year, driven by cost improvements and increased sales volumes[111]. - The Potash segment's net sales decreased to $570.2 million for the three months ended March 31, 2025, down from $643.1 million in the same period a year ago, representing an 11% decline[123]. - Average finished product selling price in the Potash segment was $234 per tonne for the three months ended March 31, 2025, compared to $258 per tonne a year ago, a decrease of 9%[124]. - Gross margin for the Potash segment decreased to $168.6 million, down from $211.7 million, reflecting a 20% decline due to lower selling prices and sales volumes[125]. - The Mosaic Fertilizantes segment's net sales increased to $933.8 million for the three months ended March 31, 2025, up from $886.4 million, a 5% increase driven by higher finished goods sales volumes[131]. - Average finished product selling price in the Mosaic Fertilizantes segment was $452 per tonne, down from $463 per tonne, a decrease of 2%[132]. - Gross margin for the Mosaic Fertilizantes segment increased to $127.0 million, up from $75.2 million, a 69% increase primarily due to lower product costs[133]. Currency and Foreign Exchange - Foreign currency transaction gain for the three months ended March 31, 2025, was $133.1 million, compared to a loss of $100.3 million in the prior year[107]. - The average consumed price for ammonia increased by 3% to $416 per tonne for the three months ended March 31, 2025, while the average consumed sulfur price increased by 11% to $157 per long ton[118]. - The average consumed price for ammonia in Brazilian operations decreased to $684 per tonne, down from $705 per tonne, a decline of 3%[135]. - The foreign currency transaction gain was $133.1 million for the three months ended March 31, 2025, compared to a loss of $100.3 million in the prior year, reflecting a significant improvement[143]. - As of March 31, 2025, the fair value of Mosaic's major foreign currency exchange contracts was $(26.7) million, a decrease from $(82.6) million as of December 31, 2024[170]. - The notional amount of short Canadian dollars was $218.1 million with a weighted average rate of 1.4088 Canadian dollars to 1 U.S. dollar as of March 31, 2025[171]. - The notional amount of long Brazilian real was $446.0 million with a weighted average rate of 5.8488 Brazilian real to 1 U.S. dollar as of March 31, 2025[171]. - The fair value of natural gas commodities contracts was zero as of March 31, 2025, compared to $(1.8) million as of December 31, 2024[173]. - Mosaic uses financial instruments such as forward contracts and futures to hedge against currency exchange rate fluctuations, particularly for the Canadian dollar and Brazilian real[169]. - The company hedges cash flows on a declining basis, up to 18 months for the Canadian dollar and up to 12 months for the Brazilian real[169]. - The fair value of foreign currency exchange derivatives reflects significant exposure to the Canadian dollar and Brazilian real, impacting earnings and cash flows[170]. - The company reported a total fair value of $(26.7) million for foreign currency exchange contracts as of March 31, 2025[171]. - The management's discussion includes further information regarding foreign currency exchange rates and derivatives in the 10-K Report[170]. Cash Flow and Liquidity - For the three months ended March 31, 2025, the net cash provided by operating activities was $42.9 million, a significant improvement of $122.9 million compared to a net cash used of $80.0 million in the same period last year[155]. - The company had cash and cash equivalents of $259.2 million, short-term debt of $1.2 billion, and long-term debt of approximately $3.4 billion as of March 31, 2025[151]. - During the three months ended March 31, 2025, the company returned cash dividends of $70.9 million and invested $340.8 million in capital expenditures[151]. - The net cash used in investing activities was $340.8 million, a decrease of 12% from $387.8 million in the prior year period[154]. - The company had $2.50 billion available under its committed revolving credit facility and approximately $0.8 billion available under uncommitted facilities as of March 31, 2025[152]. - The unfavorable change in assets and liabilities for the three months ended March 31, 2025, was primarily driven by increases in inventories of $162.4 million[156]. - The company received net proceeds of $202.1 million under its inventory financing arrangement during the three months ended March 31, 2025[158]. - The company expects its liquidity to fluctuate, particularly in the first quarter of each year, to manage through the seasonality of its business[151]. - The company had a target liquidity buffer of up to $3.0 billion, including cash and available credit lines[151]. - The company anticipates that funds generated from operations and available cash will be sufficient to finance operations, capital expenditures, and expected dividend payments for the next 12 months and beyond[152]. Expenses and Taxation - Selling, general and administrative expenses increased by $15.8 million to $122.6 million, primarily due to higher incentive compensation and employee benefit costs[140]. - The effective tax rate for the three months ended March 31, 2025, was 20.2%, with income tax expense amounting to $63.3 million[146].

Financial Data and Key Metrics Changes - Net income for the first quarter of 2025 was $238 million, with adjusted EBITDA at $544 million, reflecting strong phosphate prices and improving potash prices [9][10] - First quarter realized prices were $623 per ton for phosphate and $223 per ton for potash, exceeding guidance ranges [10][11] - Free cash flow generation was constrained by typical working capital seasonality, with expected CapEx of $1.2 billion to $1.3 billion for the year [21][40] Business Line Data and Key Metrics Changes - Phosphate production was 1.4 million tons in Q1 2025, with a production volume outlook maintained at 7.2 million to 7.6 million tons for the year [15][16] - Potash production cash cost per ton was $78, up from $72 in the prior year quarter, with expectations for costs to decline as production increases [33][34] - Mosaic Biosciences revenue more than doubled year-over-year, driven by strong sales of existing products and new product launches [18][19] Market Data and Key Metrics Changes - Global fertilizer demand remains strong, with robust demand in Brazil and a projected increase in shipments to exceed 47 million tons [24][25] - Phosphate demand is driven by rising lithium iron phosphate production in China, which grew 55% in Q1 2025 [12][13] - The North American spring season is expected to see typical demand for both phosphate and potash, with limited channel inventory remaining [22] Company Strategy and Development Direction - The company is focused on normalizing phosphate production and operating costs, with a strategic emphasis on capital reallocation and shedding non-core assets [6][8] - Mosaic's expansive market access, particularly in Brazil, positions the company well for growth amid geopolitical tensions [12][16] - The company anticipates significant opportunities for growth in new markets and products, particularly through its Mosaic Biosciences division [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term market fundamentals, despite uncertainties in global trade policies [6][12] - The company expects further improvements in segment profitability in Q2 2025, driven by seasonal demand increases [16][37] - Management highlighted the importance of maintaining cost discipline and improving asset reliability to enhance operational performance [13][14] Other Important Information - The company is on track to achieve its full-year unit cost targets, with expectations for cash flow generation to improve in the remainder of the year [16][40] - The capital reallocation program is progressing, with discussions on non-core potash assets accelerating [41] Q&A Session Summary Question: Assessment of Bartow, New Wales, and Riverview operations - Management indicated that the assessment remains similar to previous evaluations, with ongoing reliability enhancement projects paying off [45][46][50] Question: Impact of tariffs on ammonia supply - Management confirmed that current ammonia purchases have not incurred tariff impacts, with most supply coming from exempt sources [52][54] Question: Phosphate pricing and maintenance costs - Management acknowledged extraordinary maintenance costs but expects conversion costs to decline as production normalizes [60][64] Question: Potash market dynamics and Belarusian shipments - Management noted that while Belarusian shipments have not decreased, production cuts from other regions are expected to support pricing [66][68] Question: Cost of production cadence for potash - Management anticipates significant improvements in cash costs as low-cost production ramps up in the latter half of the year [71][73] Question: Mosaic's role in supply and demand dynamics - Management indicated that increased production will still align with tight supply-demand balances, particularly in phosphates [76][80] Question: Cash flow and working capital expectations - Management expects improved cash flow generation, with incremental EBITDA translating into cash flows despite working capital increases [89][92] Question: Mosaic Biosciences growth and strategy - Management outlined plans for significant revenue growth in Mosaic Biosciences, with a focus on proprietary products and market expansion [95][102]

Financial Data and Key Metrics Changes - Net income for Q1 2025 was $238 million, with adjusted EBITDA at $544 million, reflecting strong phosphate prices and improving potash prices [7][8] - First quarter realized prices were $623 per ton for phosphate and $223 per ton for potash, exceeding guidance ranges [8][9] - Free cash flow generation was constrained by typical working capital seasonality, with expected CapEx of $1.2 billion to $1.3 billion for the year [19][39] Business Line Data and Key Metrics Changes - Phosphate production was 1.4 million tons in Q1 2025, with a production volume outlook maintained at 7.2 million to 7.6 million tons for the year [13] - Potash production cash cost per ton was $78, up from $72 in the prior year, with expectations for costs to decline as production increases [32][33] - Mosaic Biosciences revenue more than doubled year-over-year, driven by strong sales of existing products and new product launches [15][16] Market Data and Key Metrics Changes - Global fertilizer demand remains strong, with solid ag commodity fundamentals despite geopolitical uncertainties [5][20] - Brazilian growers are benefiting from favorable economics, with NP and K shipments expected to exceed 47 million tons [22] - Phosphate demand is driven by rising lithium iron phosphate production in China, which grew 55% in Q1 2025 [11][24] Company Strategy and Development Direction - The company is focused on normalizing phosphate production and operating costs, with a strategic advantage in market access, particularly in Brazil [6][10] - Ongoing efforts to shed non-core assets and reallocate capital are in progress, with a commitment to return excess capital to shareholders [18][19] - The company anticipates significant growth opportunities in new markets and products, leveraging its expansive footprint in Brazil [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about navigating geopolitical dynamics and highlighted the long-term constructive market fundamentals [10][42] - The outlook for Q2 2025 is positive, with expectations for improved earnings and segment profitability [14][42] - Management noted that while there may be headwinds in the second half of the year, the overall market remains tight and supportive [21][24] Other Important Information - The company is investing in production enhancements, including a hydrofloat project expected to increase potash production volumes [12][32] - The impact of foreign exchange variations on earnings was noted, with a negative effect of $18 million in Q1 [33] - The company is closely monitoring the affordability of fertilizers in the U.S. market and its implications for demand [81] Q&A Session Summary Question: Assessment of Bartow, New Wales, and Riverview operations - Management indicated that the assessment remains similar, with ongoing reliability enhancement projects paying off [44][46][49] Question: Impact of tariffs on ammonia supply - Management confirmed that current ammonia purchases have not incurred tariff impacts, with most supply coming from exempt sources [51][52] Question: Phosphate pricing and maintenance costs - Management acknowledged extraordinary maintenance costs but expects them to normalize as production increases [57][60] Question: Potash market dynamics and Belarusian shipments - Management noted that while Belarusian shipments have not decreased, production cuts from other regions are expected to support pricing [67][68] Question: Cost of production for potash - Management expects significant improvements in potash production costs as low-cost tons come into the marketplace [71][74] Question: Mosaic's role in supply and demand dynamics - Management indicated that supply constraints will continue to support pricing, with strong demand anticipated in India [78][80] Question: Cash flow and working capital expectations - Management expects cash flow generation to improve, with incremental EBITDA contributing positively despite working capital increases [90][92] Question: Mosaic Biosciences growth and profitability - Management highlighted strong growth projections for Mosaic Biosciences, with a focus on product development and market access [96][100]

Core Viewpoint - The Mosaic Company reported a significant increase in profit for Q1 2025, despite a slight decline in net sales, primarily due to lower selling prices in the Potash segment [1][2]. Financial Performance - The company reported a profit of $238.1 million or 75 cents per share, up from $45.2 million or 14 cents per share in the same quarter last year [1]. - Adjusted earnings per share were 49 cents, exceeding the Zacks Consensus Estimate of 39 cents [1]. - Net sales decreased approximately 2% year over year to $2,620.9 million, missing the Zacks Consensus Estimate of $2,665.9 million [1]. Segment Highlights - **Potash Segment**: - Net sales were $570 million, down around 11% year over year, but exceeded the estimate of $453.7 million [2]. - Sales volumes totaled 2.1 million tons, down from 2.2 million tons a year ago, missing the estimate of 2.2 million tons [2]. - Gross margin declined to $80 per ton from $98 per ton in the prior year [2]. - **Phosphate Segment**: - Net sales were $1,099 million, down around 6% from the prior year, but topped the estimate of $1,027.3 million [3]. - Sales volumes totaled 1.5 million tons, down from 1.6 million tons a year ago, lagging the estimate of 1.7 million tons [3]. - Gross margin increased to $111 per ton from $97 per ton in the prior year [3]. - **Mosaic Fertilizantes Segment**: - Net sales were approximately $934 million, up about 5% year over year, but missed the estimate of $1,091.9 million [4]. - Sales volume rose to 1.8 million tons from 1.7 million tons in the prior year [4]. - Gross margin increased to $69 per ton from $44 per ton in the prior year [4]. Financial Position - At the end of the quarter, the company had cash and cash equivalents of $259.2 million, down 5% from the prior quarter [5]. - Long-term debt remained flat at $3,329.9 million [5]. Outlook - The company expects Potash segment sales volumes to be between 2.3 million tons and 2.5 million tons in Q2 [6]. - For the Phosphate division, sales volumes are projected to be 1.7-1.9 million tons, indicating strong global demand [6]. - Sales volumes for the Mosaic Fertilizantes unit are expected to be around 30% higher than Q1 [6]. - Capital expenditures are anticipated to be in the range of $1.2-$1.3 billion for 2025 [7]. Price Performance - Shares of Mosaic have gained 3% over the past year, compared to a 7.4% rise in the Zacks Fertilizers industry [8].

Core Insights - Mosaic reported $2.62 billion in revenue for the quarter ended March 2025, a year-over-year decline of 2.2% and an EPS of $0.49 compared to $0.65 a year ago, with a revenue surprise of -1.69% against the Zacks Consensus Estimate of $2.67 billion and an EPS surprise of +25.64% over the consensus estimate of $0.39 [1] Financial Performance - The stock has returned +29.8% over the past month, outperforming the Zacks S&P 500 composite's +11.5% change, and currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3] - Net Sales for Phosphates were reported at $1.10 billion, below the $1.15 billion average estimate, representing a -6% year-over-year change [4] - Net Sales for Mosaic Fertilizantes were $934 million, compared to the five-analyst average estimate of $1.02 billion, reflecting a year-over-year change of +5.4% [4] - Net Sales for Corporate and Other were $18 million, significantly better than the estimated -$33.01 million, but this represents a -194.7% change compared to the year-ago quarter [4] - Net Sales for Potash were $570 million, exceeding the $516.70 million average estimate, but showing an -11.4% change year-over-year [4] Sales Volumes and Pricing - Total Finished Product sales volumes for Mosaic Fertilizantes were 1,847 KTon, below the average estimate of 1,938.02 KTon [4] - The average finished product selling price for Potash was $234, slightly lower than the $237.21 average estimate [4] - Phosphates sales volumes totaled 1,498 KTon, compared to the estimated 1,591.66 KTon [4] - Potash sales volumes were reported at 2,113 KTon, below the five-analyst average estimate of 2,154.66 KTon [4] - The average finished product selling price for Phosphates was $632, lower than the four-analyst average estimate of $649.44 [4] Realized Costs - Realized costs for Sulfur in Phosphates were $157 per Ton, slightly above the average estimate of $156.99 per Ton [4] - Realized costs for Blended rock were $77 per Ton, compared to the four-analyst average estimate of $79.75 per Ton [4] - Realized costs for Ammonia were $416 per Ton, higher than the four-analyst average estimate of $406.13 per Ton [4]