CF Industries' Earnings and Sales Surpass Estimates in Q4

Core Viewpoint - CF Industries Holdings, Inc. reported a strong fourth-quarter performance with earnings per share of $1.89, surpassing both the previous year's $1.44 and the Zacks Consensus Estimate of $1.49 [1][2]. Financial Performance - Net sales for the fourth quarter decreased by approximately 3% year over year to $1,524 million, but exceeded the Zacks Consensus Estimate of $1,466.4 million [2]. - For the full year 2024, earnings per share were $6.74, down from $7.87 in the previous year, with net sales declining around 10.5% year over year to $5,936 million [8]. Segment Review - The Ammonia segment saw a 15.5% increase in net sales year over year to $572 million, exceeding estimates, with an average selling price per ton of $461 [4]. - The Granular Urea segment experienced an 11.2% decline in sales to $348 million, missing estimates, while the average selling price per ton was $347 [5]. - The Urea Ammonium Nitrate segment's sales fell around 11% to $372 million, beating estimates, with an average selling price per ton of $231 [6]. - The Ammonium Nitrate segment's sales decreased by 15.8% to $101 million, surpassing estimates, with an average selling price per ton of $283 [7]. Cash Flow and Share Repurchase - CF Industries ended 2024 with cash and cash equivalents of $1,614 million, a decrease of approximately 20.6% year over year [9]. - The company repurchased 18.8 million shares for $1.51 billion in 2024, including 4.4 million shares for $385 million in the fourth quarter [9]. Market Outlook - The company anticipates a positive global supply-demand balance, with inventories considered below normal and challenging production economics for marginal producers in Europe [10]. - Expectations for higher U.S. corn returns compared to soybeans are driven by rising corn prices and lower yield predictions, which may boost nitrogen demand [11]. - Low urea inventory in India is expected due to strong domestic demand and lower-than-targeted domestic output [12]. Stock Performance - CF Industries' shares have increased by 8.6% over the past year, outperforming the industry average rise of 2.2% [13].