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CF Industries Holdings, Inc.’s CF shares hit a fresh 52-week high of $91.06 yesterday, before retracing to close the session at $90.64.
CF stock has gained 14.9% over the past three months, outperforming the Zacks Fertilizers industry’s 1.6% rise. It has also topped the S&P 500’s roughly 5.7% rise over the same period.
Let’s take a look into the factors that are driving CF stock.
CF Stock Gains on Healthy Nitrogen Demand, Lower Gas Costs
CF Industries is benefiting from the rising global demand for nitrogen fertilizers, which is driven by significant agricultural demand. Industrial demand for nitrogen has also recovered from the pandemic-related disruptions. Global demand is expected to remain strong in the near future due to recovering industrial demand and farmer economics.
High levels of corn planted acres and low nitrogen channel inventories are expected to drive demand for nitrogen in North America. Demand for urea is also likely to remain strong in Brazil on higher corn acres. Demand in India is expected to be driven by favorable weather conditions for crop production.
Strong global nitrogen demand and reduced supply availability supported global nitrogen prices in the third quarter of 2024. CF, on its third-quarter call, said that it anticipates the global supply-demand balance to remain constructive, as inventories are believed to be below average globally while energy spreads remain significant between North America and high-cost production in Europe.
The company also stands to benefit from lower natural gas prices. It saw a decline in natural gas costs in the third quarter. The average cost of natural gas fell to $2.10 per MMBtu in the quarter from $2.54 per MMBtu in the year-ago quarter. The benefits of reduced gas costs are expected to continue in the fourth quarter.
Earnings estimates for CF have also been going up over the past 60 days. The Zacks Consensus Estimate for 2024 has increased by 5.9%. The consensus estimate for the fourth quarter of 2024 has also been revised 1.9% upward over the same time frame. The favorable estimate revisions instill investor confidence in the stock.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
CF Industries Holdings, Inc. Price and Consensus
CF Industries Holdings, Inc. price-consensus-chart | CF Industries Holdings, Inc. Quote
CF’s Zacks Rank & Other Key Picks
CF currently carries a Zacks Rank #1 (Strong Buy).
Other top-ranked stocks in the Basic Materials space are IAMGOLD Corporation IAG, Axalta Coating Systems Ltd. AXTA and Ingevity Corporation NGVT, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for IAMGOLD’s current-year earnings has increased by 24.4% in the past 60 days. IAG beat the consensus estimate in each of the last four quarters with the average surprise being 203.4%. Its shares have shot up roughly 136% in the past year.
The Zacks Consensus Estimate for Axalta Coating’s current year earnings is pegged at $2.15, indicating a rise of 36.9% from year-ago levels. The Zacks Consensus Estimate for AXTA’s current year earnings has increased 3.9% in the past 60 days. The stock has rallied around 29% in the past year.
Ingevity beat the consensus estimate in three of the last four quarters while missed once. In this timeframe, it delivered an earnings surprise of 95.4%, on average. NGVT’s shares have gained roughly 23% in the past year.
Zacks Investment Research
AngloGold Ashanti plc AU received Jersey court clearance for the acquisition of Centamin PLC. The approval brings AngloGold Ashanti's acquisition of Centamin's issued share capital to completion.
Details of AngloGold Ashanti-Centamin Deal
On Sept. 11, 2024, AngloGold Ashanti announced that it entered an agreement to acquire Egyptian gold producer Centamin. The deal, valued at £1.9 billion ($2.5 billion), will add a large-scale, long-life, world-class Tier 1 asset (Sukari) to AngloGold Ashanti’s portfolio.
On Oct. 28, 2024, Centamin shareholders approved the scheme document outlining the acquisition terms. Trading of Centamin's shares on the London and Toronto stock exchanges ceased on Nov. 21 and Nov. 20, 2024, respectively. The deal was closed on Nov. 22, 2024, following court order registration.
Centamin’s flagship asset is the Sukari gold mine in the promising Arabian Nubian Shield. It is Egypt’s first large-scale modern mine. Sukari began production in 2009, with commercial production starting in 2010. It has produced more than 5.9 million ounces of gold since 2009.
It will be a strategic fit within AngloGold Ashanti’s existing portfolio of world-class assets and projects. AU’s expertise in operating similar mines, such as Geita in Tanzania, will help maximize the value of the Sukari mine. With this addition, the proportion of gold production from its Tier 1 assets will move up from 62% to 67%.
AU’s Benefits From the Transaction
AngloGold Ashanti’s annual gold production was 2.6 million ounces in fiscal 2023. With the addition of Sukari, the annual gold production will reach 3 million ounces. It will also lead to lower combined unit total cash costs and all-in-sustaining costs.
The transaction will be accretive to AngloGold Ashanti’s cash flow per share in the first year of completion of the deal. By leveraging its existing capabilities and expertise, asset optimization program and global scale, the company expects to deliver additional upside and optimization opportunities.
AngloGold Ashanti Stock’s Price Performance
Shares of the company have gained 46.6% in the past year compared with the industry’s 34% growth.
AU’s Zacks Rank & Stocks to Consider
AU currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks from the basic materials space are CF Industries Inc. CF, Carpenter Technology Corporation CRS and IAMGOLD Corporation IAG. CF and CRS sport a Zacks Rank #1 (Strong Buy) at present, and IAG carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
CF Industries has an average trailing four-quarter earnings surprise of 10.3%. The Zacks Consensus Estimate for CF’s 2024 earnings is pegged at $6.32 per share. CF shares gained 15.8% in the last year.
Carpenter Technology has an average trailing four-quarter earnings surprise of 10%. The Zacks Consensus Estimate for CRS’s fiscal 2025 earnings is pegged at $6.44 per share. The consensus estimate for 2025 earnings has moved 6% north in the past 60 days. Its shares gained 164.9% in the last year.
IAMGOLD has an average trailing four-quarter earnings surprise of 203.1%. The Zacks Consensus Estimate for IAG’s 2024 earnings is pegged at 56 cents per share. The consensus estimate for 2024 earnings has moved 24% north in the past 60 days. Its shares gained 127.5% in the last year.
Zacks Investment Research
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