In a report released yesterday, Joel Jackson from BMO Capital maintained a Buy rating on Cf Industries Holdings (CF – Research Report), with a price target of $110.00.
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Joel Jackson has given his Buy rating due to a combination of factors that highlight CF Industries Holdings’ strong financial outlook and strategic positioning. The company is expected to achieve higher mid-cycle earnings than the market anticipates, with potential free cash flow (FCF) of approximately $10-12 per share. This projection is supported by the company’s guidance on blue ammonia premiums, which could range from $25 to $100 per short ton, depending on customer discussions and the development of the European Carbon Border Adjustment Mechanism.
CF Industries is also poised to benefit from its low-carbon initiatives, such as the D’ville project, which is expected to generate significant incremental EBITDA. The company anticipates a tight ammonia market, with demand outpacing supply, which further strengthens its position. Additionally, strategic investments and partnerships, such as the Linde investment, are expected to reduce capital expenditure and enhance financial performance. Overall, the bullish short-term dynamics, coupled with resilient gas spreads and nitrogen market conditions, underpin Jackson’s optimistic outlook for CF Industries.
In another report released today, Wells Fargo also reiterated a Buy rating on the stock with a $105.00 price target.
Based on the recent corporate insider activity of 69 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of CF in relation to earlier this year.