While cutting Mosaic to Sell, Goldman lifts price target for Potash Corp.

In suggesting investors shouldn't mistake a potash price floor for a long-term recovery, Goldman’s Adam Samuelson raises his price target for Potash (POT -1.2%) while downgrading peer Mosaic (MOS -1.3%) to Sell and maintaining a Sell rating for Intrepid Potash (IPI -1.2%).

The firm keeps POT at Neutral thanks to greater valuation support at POT given its 4.1% dividend yield, which it sees as sustainable given its pricing/cash flow forecasts; a more favorable cost outlook following recent headcount reductions, which should help the company improve utilization at lower-cost facilities; and earnings ballast from a less negative near-term outlook.

The firm's new $32 price target for POT, up from $24, still implies 5% downside, and its core industry view is that both companies will be significantly impacted.

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Comments (8)
  • Quoth the Raven
    , contributor
    Comments (2063) | Send Message
    Potash $POT will be at $40 by year's end and still crank out the divvys. Long and strong here.
    22 Jan 2014, 03:26 PM Reply Like
  • Tom Shaughnessy
    , contributor
    Comments (1145) | Send Message
    Killing it QTR!
    22 Jan 2014, 03:36 PM Reply Like
  • steve4466
    , contributor
    Comments (167) | Send Message
    GS put a target price 36 on MOS back in July when the Russian potash cartel collapsed, it seems odd they just decided to cut it to sell.
    22 Jan 2014, 03:44 PM Reply Like
  • User 195396
    , contributor
    Comments (447) | Send Message
    Nothing is ever odd or as it seems with Goldman.
    22 Jan 2014, 03:56 PM Reply Like
  • doc47
    , contributor
    Comments (1795) | Send Message
    For once I agree with Goldman: Covered calls is the only way I stay with this stock.
    22 Jan 2014, 04:05 PM Reply Like
  • xtremetrader
    , contributor
    Comments (57) | Send Message
    Another big mistake by Uralkali. Why give china such a discount? I thought that the new Uralkali leadership had changed their policy to price over volume rather than the other opposite, make you wonder!!! I think POT sp is going to take a hit, especially when they come out their earnings report.
    22 Jan 2014, 07:22 PM Reply Like
  • Ninja Trader
    , contributor
    Comments (1761) | Send Message


    I agree. Buying opportunity coming in POT after earnings.
    22 Jan 2014, 09:56 PM Reply Like
  • MrEng
    , contributor
    Comments (104) | Send Message
    I was overly optimistic, getting involved with POT, last Fall. Their must be some pretty big ego's involved with these cartel leader's to continue to behave in such an irrational and detrimental way toward the shareholder's of the respective corporations.
    22 Jan 2014, 10:39 PM Reply Like
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