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  • Credit Suisse analyst John Roberts initiated coverage of Mosaic Co MOS with an Outperform rating and a price target of $60, implying an upside of 37%.
  • The analyst mentions that MOS is not exposed to the hydrocarbon-based nitrogen market. Roughly ~40% of 2022e EBITDA is from phosphate, in which supply growth is decelerating.
  • He added that MOS also has 50%+ of sales in Brazil, the fastest growing large fertilizer market.
  • Roberts states that the other large global producers are Saudi Arabia and China. Morocco is the lowest cost producer and expands regularly.
  • MOS operates the largest wholesale fertilizer distribution business in Brazil, with domestic phosphate and potash capacity and shares in Canpotex potash exports from Canada to Brazil, notes the analyst.
  • According to Roberts, key risks to the downside include farmers delaying potash and phosphate applications to “mine the soil,” lower farm income from a more rapid recovery in Ukraine grain output, and faster recovery in Russia/Ukraine potash supplies.
  • Price Action: MOS shares are trading lower by 5.81% at $43.62 on the last check Thursday.
  • Photo Via Company

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