CF Industries: Improved Pricing Outlook Offset by Market and Feedstock Uncertainties, Justifying Hold Rating

In a report released yesterday, Vincent Andrews from Morgan Stanley maintained a Hold rating on Cf Industries Holdings, with a price target of $95.00.

Vincent Andrews has given his Hold rating due to a combination of factors related to CF Industries’ earnings outlook and market uncertainties. He has raised his EBITDA forecasts for 4Q25 and 2026 on the back of higher expected realized ammonia and nitrogen prices, reflecting stronger pricing in the US Midwest and firm international benchmarks such as Tampa. At the same time, he modestly reduced near-term nitrogen volume expectations to account for recent adverse winter weather that could hinder December applications, partly offsetting the benefit from improved pricing. Operationally, temporary issues at the Yazoo City facility are not expected to materially affect ammonia sales, which supports a relatively stable fundamental profile.

Andrews also highlights several sources of uncertainty that constrain the upside case and justify maintaining a neutral stance. Investor sentiment is divided between those anticipating another robust US corn season in 2026, which would support nitrogen demand, and those worried about persistent Chinese urea exports amid high domestic inventories, which could pressure global pricing. Additionally, there are concerns that natural gas price differentials may narrow as US LNG exports expand, potentially eroding CF’s cost advantage over time. Given this mix of improved earnings estimates but meaningful macro and regulatory risks around nitrogen pricing and feedstock costs, a Hold rating is seen as appropriate pending clearer visibility on 2026 pricing dynamics.

In another report released on December 10, RBC Capital also maintained a Hold rating on the stock with a $90.00 price target.