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Mosaic (MOS) Announces Early Redemption of Notes Worth $450M

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The Mosaic Company MOS declared that it has submitted an early redemption notice to the trustee of its $450-million 3.75% senior notes. The notes, due Nov 15, 2021, are anticipated to be called at par on Aug 15, 2021 and expected to lead to an immaterial expenses in the third quarter. The yearly interest expenses on these notes were roughly $17 million.

Mosaic stated that this is its first step in reaching the goal of reducing total long-term debt by $1 billion. The company has generated significant cash flow through disciplined cost management and favorable markets. The cashflow will continue to be allocated in a balanced approach to strengthen the balance sheet, investing in the business and returning capital to shareholders.

Notably, Mosaic ended the first quarter with cash and cash equivalents of $692 million, up around 20.6% year over year.Net cash provided by operating activities increased roughly 68% year over year to $318.8 million in the quarter.

Shares of Mosaic have gained 158.5% in the past year compared with 87.7% rise of the industry.

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Zacks Investment Research

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The company, in its last earnings call, noted that it expects strong fundamental trends witnessed in the last three quarters to continue through 2021. Strong crop demand, affordable inputs and favorable weather indicate strong grower economics.

Chinese phosphate exports are expected to remain low in 2021 due to high domestic demand and recent industry restructuring limit supplies available for export.

The company projects $80-$90 per ton improvement in realized prices in the Phosphates segment, sequentially, in the second quarter. In the Potash segment, $20-$30 per ton improvement in realized prices is expected in the second quarter.

The Mosaic Company Price and Consensus

The Mosaic Company Price and Consensus
The Mosaic Company Price and Consensus

The Mosaic Company price-consensus-chart | The Mosaic Company Quote

Zacks Rank & Key Picks

Mosaic currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Nucor Corporation NUE, Olin Corporation OLN and Cabot Corporation CBT.

Nucor has a projected earnings growth rate of around 344.9% for the current year. The company’s shares have surged 141.1% in a year. It currently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Olin has an expected earnings growth rate of around 506.7% for the current year. The company’s shares have skyrocketed 333.4% in the past year. It currently sports a Zacks Rank #1.

Cabot has an expected earnings growth rate of around 137.5% for the current fiscal. The company’s shares have surged 61.8% in the past year. It currently flaunts a Zacks Rank #1.

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