Bank of America Securities analyst Matthew DeYoe has reiterated their bullish stance on MOS stock, giving a Buy rating today.
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Matthew DeYoe has given his Buy rating due to a combination of factors, despite some mixed signals in Mosaic Co’s recent performance. The company reported a third-quarter adjusted EBITDA of $806 million, surpassing the consensus estimate of $766 million, although this was primarily driven by lower corporate expenses and a reversal of bad debt expense rather than core business strength. Despite this, DeYoe remains optimistic about the structural backdrop for phosphates, which supports the Buy rating.
However, there are areas of concern that Mosaic Co needs to address to maintain investor confidence. The company’s core Potash and Phosphate EBITDA fell short of expectations, and there were higher-than-anticipated costs in ammonia, sulfur, and blended rock. Additionally, the Fertilizantes segment showed a softer EBITDA guide, attributed to credit issues. Nevertheless, the headline beat in EBITDA could provide some relief from the ongoing sell pressure on MOS shares, and DeYoe believes that improving operational efficiency and management credibility will be crucial for the company’s future performance.
In another report released today, Barclays also maintained a Buy rating on the stock with a $42.00 price target.