CF Industries (CF) outpaces stock market gains: what you need to know


ILast trading session, CF Industries (CF) closed at $66.44, marking a +1.31% move from the previous day. This change outpaced the S&P 500’s 0.08% gain on the day. Meanwhile, the Dow Jones lost 0.56% and the tech-heavy Nasdaq lost 0.42%.

As of today, shares of the fertilizer maker have gained 1.97% over the past month. Meanwhile, the basic materials sector gained 7.48%, while the S&P 500 gained 0.22%.

Investors are hoping for strength from CF Industries as its next earnings release approaches. On that day, CF Industries is expected to report earnings of $3.05 per share, which would represent 662.5% year-over-year growth. Meanwhile, our latest consensus estimate calls for revenue of $2.38 billion, up 115.58% from the prior year quarter.

Any recent changes in analyst estimates for CF Industries should also be noted by investors. These revisions help show the ever-changing nature of short-term trading trends. With this in mind, we can view positive estimate revisions as a sign of optimism about the company’s business outlook.

Based on our research, we believe that these estimate revisions are directly related to the team’s close stock movements. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes into account these estimation changes and provides a clear and actionable scoring model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive track record of outperformance verified by external audits, with #1 stocks generating an average annual return of +25% since 1988 Over the past 30 days, our consensus EPS projection has increased by 5.4%. CF Industries currently sports a Zacks rank of #1 (Strong Buy).

Valuation is also important, so investors should note that CF Industries has a forward P/E ratio of 5.29 at this time. Its industry sports an average Forward P/E of 7.79, so we can conclude that CF Industries is trading at a comparatively lower price.

Investors should also note that CF has a PEG ratio of 0.88 at this time. This measure is used in the same way as the famous P/E ratio, but the PEG ratio also takes into account the growth rate of the stock’s expected earnings. The CF industry had an average PEG ratio of 0.79 at yesterday’s close.

The Fertilizer industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Ranking of 5, which places it in the top 2% of over 250 industries.

The Zacks Industry Ranking assesses the strength of our industry groups by measuring the average Zacks Ranking of individual stocks within the groups. Our research shows that the top 50% of industries outperform the bottom half by a factor of 2 to 1.

To follow CF in future trading sessions, be sure to use Zacks.com.

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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.

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