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Compass Minerals International Inc (CMP)
NYSE:CMP
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Compass Minerals International (CMP) AI Stock Analysis

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CMP

Compass Minerals International

(NYSE:CMP)

Rating:54Neutral
Price Target:
$22.50
▲(4.70%Upside)
Compass Minerals International's overall stock score is primarily impacted by its financial performance challenges, including negative profitability and high leverage. While technical indicators show bullish momentum, the overbought conditions suggest caution. The company's strategic financial maneuvers and positive earnings call sentiment provide some optimism, but significant risks remain.
Positive Factors
Earnings Potential
Cold weather positions the company well for better earnings later in F2025 and perhaps in F2026 as inventories are depleted due to higher demand for salt.
Financial Performance
Compass' balance sheet and cash flow look to be improving as it works down inventories, which could raise its cash flow and deliver positive free cash flow in 2025.
Market Position
The analyst raised the investment rating on Compass Minerals from Neutral to Overweight, suggesting confidence in future performance and valuation.
Negative Factors
Dividend Policy
Compass cut its dividend significantly and eventually eliminated it entirely, which may concern income-focused investors.
Legal and Regulatory Issues
The company was fined by the SEC for misleading investors and was subsequently sued, which may impact its reputation and financial standing.
Operational Challenges
The company's Q1 EBITDA significantly missed consensus expectations, indicating operational challenges.

Compass Minerals International (CMP) vs. SPDR S&P 500 ETF (SPY)

Compass Minerals International Business Overview & Revenue Model

Company DescriptionCompass Minerals International, Inc., produces and sells essential minerals primarily in the United States, Canada, Brazil, the United Kingdom, and internationally. It operates through three segments: Salt, Plant Nutrition North America, and Plant Nutrition South America. The Salt segment offers sodium chloride and magnesium chloride, including rock salt, mechanically and solar evaporated salt, and brine and flake magnesium chloride products; and purchases potassium chloride and calcium chloride to sell as finished products or to blend with salt to produce specialty products. This segment provides products for use as a deicer for roadways, consumer, and professional use; as an ingredient in chemical production; for water treatment, human, and animal nutrition; and for various other consumer and industrial uses, as well as records management services. The Plant Nutrition North America segment offers sulfate of potash specialty fertilizers in various grades, including agricultural products that are used in broadcast spreaders, direct application, and liquid fertilizer solutions; turf products used by the turf and ornamental markets, as well as for blends used on golf course greens; organic products under the Protassium+ brand; and micronutrient products under the Wolf Trax and other brands. This segment provides its products to distributors and retailers of crop inputs, as well as growers. The Plant Nutrition South America segment offers various specialty plant nutrients and supplements; water and wastewater treatment chemicals for cleaning, decontaminating, and purifying water; and process chemicals for industrial use. The company was formerly known as Salt Holdings Corporation and changed its name to Compass Minerals International, Inc. in December 2003. Compass Minerals International, Inc. was founded in 1993 and is headquartered in Overland Park, Kansas.
How the Company Makes MoneyCompass Minerals generates revenue through the production and sale of its core products: salt and plant nutrition products. The Salt segment primarily earns income from the sale of de-icing salt used by municipalities for road safety during winter months, as well as consumer and industrial salts used in food processing, water conditioning, and other industrial applications. The Plant Nutrition segment focuses on specialty plant nutrition products, including sulfate of potash, which are sold to agricultural customers aiming to improve crop yield and quality. The company's earnings are bolstered by long-term supply contracts and strategic partnerships with local governments, agricultural cooperatives, and industrial clients, which help ensure a steady demand for its products. Additionally, Compass Minerals benefits from its cost-effective mining and production processes, which contribute to maintaining a competitive edge in the market.

Compass Minerals International Earnings Call Summary

Earnings Call Date:May 07, 2025
(Q2-2025)
|
% Change Since: 51.02%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a company on the path to recovery, with significant improvements in inventory management and debt reduction. However, ongoing challenges in pricing and margins continue to impact overall performance.
Q2-2025 Updates
Positive Updates
Successful Execution of Back-to-Basic Strategy
North American highway de-icing inventory values decreased by 47% year-over-year, while volumes were down 59%. This resulted in a $145 million working capital release and a $170 million reduction in total debt.
Revenue and Volume Growth
Consolidated revenue for the second quarter was $495 million, up 36% year-over-year. Salt business revenue increased to $433 million from $310 million, with volumes up 47% compared to the prior period.
Improved Financial Position
The company reduced total net debt by $171 million sequentially, with liquidity reaching $329 million. Adjusted EBITDA guidance was increased to a midpoint of $188 million for the year.
Negative Updates
Continued Operating Losses
The company reported an operating loss of $3.1 million for the quarter, although this was an improvement from a $39.3 million loss last year.
Decreased Pricing and Margins in Salt Business
Pricing in the salt business was down 5% year-over-year, and operating earnings per ton decreased 31%, while adjusted EBITDA per ton declined 30%.
Challenges in Plant Nutrition Business
Despite a 16% increase in revenue, pricing in the Plant Nutrition business was down 8%, and distribution costs per ton increased by 13%.
Company Guidance
During the Compass Minerals' Second Fiscal 2025 Earnings Call, the company provided several key metrics and guidance updates. The North American highway de-icing inventory values have decreased by 47% year-over-year, with volumes down by 59%, leading to a $145 million working capital release. This reduction helped decrease total debt by over $170 million within the quarter. The company reported consolidated revenue of $495 million, a 36% increase year-over-year, while the operating loss improved from $39.3 million last year to $3.1 million this quarter. Adjusted EBITDA was $84.1 million, with a modified adjusted EBITDA of $76.2 million. Compass Minerals increased its adjusted EBITDA guidance for the year to $188 million at the midpoint, up from the previous $173 million. Additionally, capital expenditures are expected to remain between $75 million and $85 million, aligning with their Back-to-Basic strategy to optimize production, manage costs, and enhance free cash flow.

Compass Minerals International Financial Statement Overview

Summary
Compass Minerals International faces significant financial challenges, with declining revenues and negative profitability metrics. High leverage and reduced cash flow generation further emphasize the need for strategic improvements. The company must focus on stabilizing its operations to enhance both profitability and financial health.
Income Statement
42
Neutral
Compass Minerals International has faced significant challenges in its recent performance with a negative TTM net income and declining revenue. The company's TTM gross profit margin is 17.4%, which reflects a decrease from previous years. The net profit margin has turned negative, indicating issues with profitability. Additionally, the EBIT and EBITDA margins are negative, implying operational difficulties.
Balance Sheet
50
Neutral
The balance sheet reveals a high debt-to-equity ratio, indicating significant leverage with a ratio of 2.90. This could pose risks if earnings do not improve. The equity ratio is 19.3%, suggesting moderate financial stability. Return on equity is negative due to the net losses, highlighting the need for improved profitability.
Cash Flow
35
Negative
The cash flow statement shows negative free cash flow growth, with a decline from the previous year. The operating cash flow to net income ratio is concerning due to negative net income. The company needs to enhance its cash generation capabilities to improve financial flexibility.
BreakdownSep 2024Sep 2023Sep 2022Dec 2020Dec 2019
Income Statement
Total Revenue1.12B1.20B1.24B1.49B1.09B
Gross Profit195.00M233.90M198.00M336.80M232.50M
EBITDA-13.70M90.70M39.40M153.00M245.60M
Net Income-206.10M15.50M-36.70M59.50M60.80M
Balance Sheet
Total Assets1.64B1.82B1.64B2.44B2.37B
Cash, Cash Equivalents and Short-Term Investments20.20M38.70M46.10M34.70M27.00M
Total Debt917.50M805.30M947.60M1.42B1.36B
Total Liabilities1.32B1.30B1.39B1.91B1.83B
Stockholders Equity316.60M517.20M257.00M529.60M540.20M
Cash Flow
Free Cash Flow-99.80M-48.30M23.80M61.50M93.90M
Operating Cash Flow14.40M101.10M120.50M159.60M190.70M
Investing Cash Flow-116.10M-173.00M-80.00M-100.40M-99.60M
Financing Cash Flow83.10M64.00M-14.30M-50.50M-85.90M

Compass Minerals International Technical Analysis

Technical Analysis Sentiment
Positive
Last Price21.49
Price Trends
50DMA
20.25
Positive
100DMA
15.72
Positive
200DMA
14.23
Positive
Market Momentum
MACD
0.45
Positive
RSI
57.40
Neutral
STOCH
40.48
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CMP, the sentiment is Positive. The current price of 21.49 is above the 20-day moving average (MA) of 21.30, above the 50-day MA of 20.25, and above the 200-day MA of 14.23, indicating a bullish trend. The MACD of 0.45 indicates Positive momentum. The RSI at 57.40 is Neutral, neither overbought nor oversold. The STOCH value of 40.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CMP.

Compass Minerals International Risk Analysis

Compass Minerals International disclosed 7 risk factors in its most recent earnings report. Compass Minerals International reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Compass Minerals International Peers Comparison

Overall Rating
UnderperformOutperform
Sector (44)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
57
Neutral
$424.00M-4.38%105.14%84.95%
55
Neutral
$886.47M27.86-7.29%1.14%-4.98%-192.96%
54
Neutral
$894.42M-46.32%1.61%5.81%-78.45%
48
Neutral
$387.69M-814.96%
44
Neutral
AU$1.51B-6.04-41.37%3.90%-3.45%-43.04%
42
Neutral
$3.06B-667.42%-3.49%
35
Underperform
$1.16B-40.55%-15.85%
* Basic Materials Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CMP
Compass Minerals International
21.49
8.50
65.43%
GSM
Ferroglobe
4.75
-0.59
-11.05%
UAMY
United States Antimony
3.73
3.38
965.71%
TMC
TMC the metals company Inc.
7.63
6.44
541.18%
LZM
Lifezone Metals
4.90
-2.60
-34.67%
IPX
Iperionx Ltd. ADR
36.25
21.44
144.77%

Compass Minerals International Corporate Events

Executive/Board Changes
Compass Minerals Announces Leadership Change with New Interim Counsel
Neutral
Jun 27, 2025

On June 26, 2025, Mary L. Frontczak stepped down from her role as Chief Legal and Administrative Officer and Corporate Secretary at Compass Minerals International. James D. Hughes has taken over the responsibilities as General Counsel and Corporate Secretary on an interim basis, indicating a shift in the company’s leadership structure.

The most recent analyst rating on (CMP) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Compass Minerals International stock, see the CMP Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Compass Minerals Completes $650M Senior Notes Offering
Positive
Jun 16, 2025

On June 16, 2025, Compass Minerals International, Inc. completed a private offering of $650 million in senior notes due 2030, with an interest rate of 8.000%. The proceeds are being used to repay existing credit agreements, redeem $350 million of senior notes due 2027, and for general corporate purposes. This move is part of a broader financial strategy, including an amendment to its credit agreement, which stabilizes revolving commitments and permits the issuance of these notes. The transaction is expected to strengthen Compass Minerals’ financial position by managing debt and providing additional liquidity.

The most recent analyst rating on (CMP) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Compass Minerals International stock, see the CMP Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Compass Minerals Announces $650 Million Senior Notes Offering
Positive
Jun 3, 2025

On June 3, 2025, Compass Minerals announced the pricing of a $650 million offering of senior notes due 2030, with the sale expected to close around June 16, 2025. The proceeds will be used to repay existing debt, redeem $350 million of senior notes due 2027, and for general corporate purposes. Concurrently, the company plans to amend its senior secured credit agreement to adjust financial covenants and revolving commitments. This strategic financial maneuver aims to optimize the company’s debt structure and enhance its financial flexibility.

The most recent analyst rating on (CMP) stock is a Hold with a $18.00 price target. To see the full list of analyst forecasts on Compass Minerals International stock, see the CMP Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 03, 2025