Thursday, April 3, 2008

Today's Upgrade in the Fertilizer Stocks

Thanks to a reader who sent me one of the 2 analyst reports today. Some good info out there (including risks from rising natural gas and sulphur) but the earnings upgrades are astounding. I wrote back in October the analysts have been wrong, and continue to be wrong on their estimates [Oct 23: Analysts Still Doubting the Fertilizer Stocks]. Now, prices have even surpassed my rosy assumption, so even I've been wrong in my estimates for the future - I was thinking $9.00+ EPS for Mosaic in 2009 (current consensus $7.40). Merrill Lynch just blew me out of the water. This is why I keep saying forget basing these on analyst estimates - they are sorely lacking...

2009 (old) $7.65 (new) $12.00
2010 (old) $8.30 (new) $14.50

2009 (old) $9.80 (new) $14.00
2010 (old) $11.00 (new) $16.00

CF Industries
2009 (old) $13.00 (new) $18.00
2010 (old) $13.00 (old) $20.00

And with that... I think analysts have finally gotten the picture... finally.

....these numbers continue to make the frantic hang wringing over input costs that cause these stocks to continuosly sell off simply silly. Stick with fertilizer and stick with Cram.... err, umm... well stick with fertilizer... ;)

Long all names mentioned in fund; long Mosaic in personal account

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