Is CF Industries Stock Outperforming the Dow?

Northbrook, Illinois-based CF Industries Holdings, Inc. (CF) is one of the largest producers of ammonia and a global leader in nitrogen-based solutions for agricultural and industrial applications. It is valued at a market cap of $19.5 billion. 

Companies worth $10 billion or more are typically classified as “large-cap stocks,” and CF fits the label perfectly, with its market cap exceeding this threshold, underscoring its size, influence, and dominance within the agricultural inputs industry. The company operates a highly cost-advantaged manufacturing and distribution network across North America and the United Kingdom, leveraging low-cost natural gas feedstocks to maintain industry-leading margins. 

This agriculture company is currently trading 7.1% below its 52-week high of $137.44, reached on Mar. 12. Shares of CF have rallied 62.5% over the past three months, notably outperforming the Dow Jones Industrial Average’s ($DOWI) 4.8% drop during the same time frame.

Moreover, on a YTD basis, shares of CF are up 65.4%, compared to DOWI’s 4.6% fall. In the longer term, CF has soared 65.3% over the past 52 weeks, significantly outperforming DOWI’s 9.2% uptick over the same time frame. 

To confirm its bullish trend, CF has been trading above its 200-day moving average since mid-January and has remained above its 50-day moving average since early January. 

On Feb. 18, CF delivered stronger-than-expected Q4 results, and its shares surged 3.8% in the following trading session. The company’s revenue increased 22.8% year-over-year to $1.9 billion, surpassing Wall Street estimates by 4.5%. Moreover, its adjusted EBITDA of $821 million grew 46.1% from the same period last year, while its adjusted EPS of $2.99 handily topped analyst expectations by 19.6%. 

CF has significantly outpaced its rival, The Mosaic Company (MOS), which declined 6.3% over the past 52 weeks and increased 8.8% on a YTD basis.  

Despite CF’s recent outperformance, analysts remain cautious about its prospects. The stock has a consensus rating of "Hold” from the 19 analysts covering it. While the company is trading above its mean price target of $99.67, its Street-high price target of $150 suggests a 19.5% premium to its current price levels.