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CF Industries Holdings Inc CF

Morningstar Rating
$80.72 +0.82 (1.03%)
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Company Report

CF Industries Earnings: Nitrogen Prices Will Likely Be Lower Again in 2024

CF Industries' fourth-quarter results reflected lower nitrogen prices that were partially offset by lower U.S. natural gas prices reducing the company's input costs. Adjusted EBITDA fell over 50% versus the prior-year quarter due to lower prices. For nitrogen producers, 2022 marked peak cyclical conditions, with nitrogen prices reaching multiyear highs. As such, we had expected CF's profits would see cyclical highs in 2022 and decline in 2023. Having updated our model to incorporate these results, we maintain our $85 fair value estimate. Our narrow moat rating is also unchanged.

Price vs Fair Value

CF is trading at a 5% discount.
Price
$80.72
Fair Value
$49.00
Uncertainty
High
1-Star Price
$842.96
5-Star Price
$56.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

High shipping and storage costs for importers of nitrogen fertilizer limit the competition CF faces in North American markets from outside regions with low natural gas costs.

Bears

Soybeans, which do not require nitrogen fertilizer, have seen a growing share of planted acres in North America, hurting nitrogen fertilizer demand.

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News

Trading Information

Previous Close Price
$79.90
Day Range
$79.0281.27
52-Week Range
$60.0887.90
Bid/Ask
$78.64 / $81.64
Market Cap
$15.20 Bil
Volume/Avg
3.6 Mil / 2.2 Mil

Key Statistics

Price/Earnings (Normalized)
10.15
Price/Sales
2.36
Dividend Yield (Trailing)
2.11%
Dividend Yield (Forward)
2.48%
Total Yield
5.92%

Company Profile

CF Industries is a leading producer and distributor of nitrogen, which is primarily used in fertilizers. The company operates nitrogen manufacturing plants primarily in North America. CF also produces nitrogen in the United Kingdom and holds a joint venture interest in a nitrogen production facility in Trinidad and Tobago. CF makes nitrogen primarily using low-cost U.S. natural gas as its feedstock, making CF one of the lowest-cost nitrogen producers globally. The company is also investing in carbon-free blue and green ammonia, which can be used an alternative fuel to hydrogen or as a means to transport hydrogen.
Sector
Basic Materials
Industry
Agricultural Inputs
Stock Style Box
Mid Core
Total Number of Employees
2,700

Competitors

Valuation

Metric
CF
NTR
MOS
Price/Earnings (Normalized)
10.158.866.77
Price/Book Value
2.661.030.82
Price/Sales
2.360.890.76
Price/Cash Flow
5.725.695.18
Price/Earnings
CF
NTR
MOS

Financial Strength

Metric
CF
NTR
MOS
Quick Ratio
3.170.730.49
Current Ratio
3.811.251.22
Interest Coverage
15.505.767.70
Quick Ratio
CF
NTR
MOS

Profitability

Metric
CF
NTR
MOS
Return on Assets (Normalized)
13.81%5.61%4.99%
Return on Equity (Normalized)
33.93%11.93%9.46%
Return on Invested Capital (Normalized)
16.31%8.85%7.74%
Return on Assets
CF
NTR
MOS
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