Key Takeaways
- MOS stock has reported negative earnings surprises of around 10.2% over the past four quarters.
- MOS shares have lost 19.6% the past year compared to the broader Fertilizer industry's 10.3% decline.
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The Mosaic Company MOS is set to release third-quarter 2024 results before the opening bell on Nov. 12.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
The fertilizer maker delivered a negative earnings surprise of around 10.2%, on average, over the trailing four quarters. It delivered a negative earnings surprise of around 20.6% in the last reported quarter. The company’s third-quarter results are likely to reflect favorable demand for phosphate and potash. Weaker fertilizer prices and operational disruptions are expected to have affected its performance.
Mosaic’s shares have lost 19.6% in the past year compared with the Zacks Fertilizers industry’s 10.3% decline.
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Let’s see how things are shaping up for this announcement.
What do MOS’s Revenue Estimates Indicate?
The Zacks Consensus Estimate for Mosaic’s third-quarter consolidated sales is currently pegged at $3,284.3 million, calling for a decline of 7.4% from the year-ago quarter’s tally.
Factors at Play for MOS Stock
Mosaic is expected to have gained from favorable demand for phosphate and potash in the September quarter, aided by favorable agricultural conditions. Attractive farm economics and improved affordability are driving demand for fertilizers globally. Farmer economics remains attractive in most global growing regions on strong crop demand and affordable inputs. Demand for grains and oilseeds remains high along with strong farm economics.
The company’s production volumes and shipments are likely to have been impacted by operational challenges in the third quarter. Mosaic, in September 2024, noted that it encountered electrical equipment failures, which impacted both the Esterhazy and Colonsay potash mines. MOS expects these operational challenges to reduce third-quarter potash production and shipment volumes by 200,000 to 300,000 tons. Production disruptions caused by weather-related events including Hurricane Francine are also expected to have impacted phosphate volumes and shipments in the quarter to be reported. MOS also curtailed shipments in late September in anticipation of Hurricane Helene.
Our estimate for potash sales volumes for the third quarter is pegged at 1.968 million tons. We also expect phosphate sales volumes for the quarter to be 1.634 million tons.
Weaker potash and phosphate prices may have impacted the company’s margins. Prices of phosphate and potash have retreated since the back half of 2022 from their peak levels attained in the first half riding on the impacts of the Russia-Ukraine war and disruptions due to the sanctions in Belarus. Prices of crop nutrients remained under pressure during 2023 as the resumption of exports from top suppliers Belarus and Russia led to higher supplies. Despite some recovery of late, weaker fertilizer prices are expected to have weighed on the company’s profitability in the September quarter.
Our estimate for average selling price per ton for the Potash segment is pegged at $219, reflecting a sequential decline of 22.6%. We also expect average selling price per ton for the Phosphate unit to be $572, indicating a 14.2% decline from the prior quarter.
What Our Model Unveils for MOS Stock
Our proven model does not conclusively predict an earnings beat for Mosaic this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.
Earnings ESP: Earnings ESP for MOS is 0.00%. The Zacks Consensus Estimate for earnings for the third quarter is currently pegged at 58 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: MOS currently carries a Zacks Rank #3.
Stocks That Warrant a Look
Here are some companies you may want to consider as our model shows they have the right combination of elements to post an earnings beat this quarter:
Hudbay Minerals Inc. HBM, scheduled to release third-quarter earnings on Nov. 13, has an Earnings ESP of +3.06%.
The Zacks Consensus Estimate for Hudbay Minerals’ earnings for the third quarter is currently pegged at 5 cents. HBM currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Berry Global Group, Inc. BERY, scheduled to release earnings on Nov. 20, has an Earnings ESP of +0.25% and carries a Zacks Rank #3.
The consensus estimate for BERY’s earnings for the fiscal fourth quarter is currently pegged at $2.25.
CAVA Group, Inc. CAVA, slated to release earnings on Nov. 12, has an Earnings ESP of +3.38% and carries a Zacks Rank #2 at present.
The consensus mark for CAVA’s third-quarter earnings is currently pegged at 11 cents.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
