CF Industries
manufactures and distribute nitrogen and phosphate fertilizers in North America . The
company, which went public in 2005, has grown profits from $.60 to $23.25 in
2013 and dividends from $.02 to $2.20 in the same time frame. It has earned between 12% and 20% return on
equity. CF should continue its above
average growth rate because:
(1) program to
rationalize operations to reduce costs,
(2) recent
acquisition of Terra has made it the leading global producer of nitrogen
fertilizer,
(3)
stock buyback program,
(4)
falling natural gas prices, a key ingredient in the making of fertilizer.
Negatives:
(1) price competition with its domestic
competitors,
(2)
its business serves a highly cyclical industry.
CF
is rated A by Value Line, carries a 36% debt to equity ratio and its stock
yields 1.7%.
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio Since 2005
CF 1.7% 35% 17% 5
Ind Ave 3.2 22 46 NA
Debt/ EPS Down Net Value Line
Equity ROE Since 2005 Margin Rating
CF 36% 22% 2 25% A
Ind Ave 30 19 NA 15 NA
Chart
Note:
CF stock made good progress off its October 2008 low, quickly surpassing the downtrend
off its July 2007 high (straight red line) and the November 2008 trading high
(green line). Long term, the stock is in
an uptrend (blue lines); intermediate term, it is in an uptrend (purple lines). The wiggly red line is the 50 day moving
average. The Aggressive Growth Portfolio
owns a full position in CF. The stock
currently on the Aggressive Growth Buy List.
The lower boundary of its Sell Half Range is $352.
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