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An integrated fertilizer and related industrial and feed products company.
View All Commentary (POT)
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pabloso (65.82) Submitted: 8/07/08 4:54 PM : Start Price: $172.38 POT Score: 24.86
I've had POT for a long time and recent growth seems completely out of wack. PE, market cap way to big. There is a macro trend toward need for fertilizer, but the run up in price looks like the internet boom to me. And what about their competition? Surely they will catch up. Surely commodities will wain in popularity just as all the other "fads" have. Sell at least half of what you've got and wait for a lower price <100 if want to make a fairly good long term bet on fertilizer.
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MLGtrader (99.67) Submitted: 8/20/08 3:27 AM
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Hey now don't be a noob on me! Growth is not out of wack, it is amazing. 2008 forward pe is 14. Because potash is sold in one year contracts, potash prices will continue to be realized in revenue and net income through 2009, without an increase in fertilizer prices. All analysts are positive on this stock = targets above $300. Commodity prices have halted their tumble, so now would be a great buy. Look for this stock to make a run when the market releases the weakness in almost every other sector and investors come running back to the safety of commodities. Also buy DIG.
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pegburt (< 20) Submitted: 8/20/08 3:46 AM
The internet boom was caused by pure speculation; fertilizer companies have been growing consistently (not just share price, but earnings growth). The fundamentals are all there, and now is a perfect price to buy. With the US economy looking like a scrap heap, the fed not even daring to raise interest rates, increasing global demand for food, and alternative fuels making headlines...fertilizer is practically guaranteed to rise in the next year. Their PE is too big? How much is the market willing to pay for yoy earnings growth of 220%? Only 27x earnings? They have a 2009E EPS of 15.50. That means that if they keep their current "high" PE of 27, their share price will be pushing 400. Newsflash: it's trading at 175 today...
brintoul (97.55) Submitted: 9/24/08 2:41 PM
How's the POT call workin' out for ya?
pabloso (65.82) Submitted: 10/21/08 4:05 PM
I smoked my last joint at 175. I thought seriously about putting in a limit order at 230 this summer. Ah well. Might be worth buying at 60-70 though. For now, I can at least remove the suspicious "POT" references from my computer's auto-complete lists.
pabloso (65.82) Submitted: 10/21/08 4:25 PM
I understand all of these arguments, but I also know that sometime customers have a hard time paying for what they contracted for. What does POT do then? Bankrupt their loyal customers by enforcing payment? Those customers are their future profits. They will have to take what they can get and move on. I probably exaggerate, but not too much. I take my lessons from the telecom boom. "Contracts" with "good customers" were set aside once those good customers had problems paying. They knew they would have to go back to those same customers in the future and no point upsetting them, thus surrendering future business to rivals. What POT seems to have going for it is that they are a solid company. Stick with it and eventually you will reap rewards.
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