PotashCorp Missed 1Q16 Estimates: What’s Next?
Why PotashCorp Missed 1Q16 Estimates
PotashCorp’s 1Q16 earnings
The Potash Corporation of Saskatchewan (POT), also known as PotashCorp, reported its 1Q16 earnings on April 28. The company posted EPS (earnings per share) of $0.15, which missed analysts’ estimates of $0.16 per share. Following the earnings, the stock fell 3.4% to settle at $17.6 per share on April 28. YTD (year-to-date), shares are up by ~1%.
Earnings miss
During the earnings call, PotashCorp’s management stated that “price pressure across all three nutrients was a key contributor to weaker first quarter earnings.” We’ll discuss prices for all three NPK fertilizers in detail later in this series.
PotashCorp’s competitor Mosaic Company (MOS) is up by 0.8% YTD. Israel Chemicals (ICL) is up by as much as 20.7% YTD. However, CF Industries Holdings (CF) and Intrepid Potash (IPI) are down by 16.6% and 53%, respectively. Over this period, the S&P 500 benchmark index is up by 0.6% and the PowerShares International Dividend Achievers Portfolio (PID) has fared better with returns of 7.7% YTD.
Series overview
In this series, we’ll analyze why PotashCorp missed earnings and what the future holds for PotashCorp in light of its 1Q16 earnings. We’ll discuss the performance and outlook for each of the company’s three NPK segments. We’ll also discuss prices, shipments, and volumes, which are key to PotashCorp’s revenues, and look at valuation multiples for the company.
Let’s begin with PotashCorp’s 1Q16 sales.
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