What to Look for in Potash Corporation's 3Q15 Earnings

Potash Corporation (POT) is expected to release its earnings tomorrow, October 29, before the market opens. One of the largest producers of potash-based fertilizers, Potash Corporation has fallen 39% YTD (year-to-date), while Sociedad Química y Minera de Chile (SQM) has fallen 18%, Mosaic (MOS) has fallen 23%, and Intrepid Potash (IPI) has fallen 59%. The Market Vectors Agribusiness ETF (MOO) has also fallen 6.8% YTD, indicating overall weakness in the industry.

• Wall Street analysts are expecting Potash Corporation to report EPS of $0.38, which would be flat from the corresponding quarter a year ago.
• Fertilizer companies are facing a slowdown as a result of several factors that have delayed purchase of fertilizers.
• Companies such as Mosaic even issued a statement in September to update investors about the prevailing weakness.
• Mosaic (MOS) and Potash Corporation (POT) fell 7% and 6.5%, respectively, following Mosaic’s update.
• As of the date of this writing, Potash Corporation is trading at $21.2, which is close to the lower end of the company’s 52-week range of $19.4–$36.6.

In this series, we’ll discuss some of the key topics that will be important points of discussion during Potash Corporation’s earnings call. This includes a discussion of fertilizer prices, shipments, global economic conditions, farm economics, and other factors that affect the company’s performance. We’ll wrap up this series by looking at valuation multiples and discussing where the stock might go after the earnings release.

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Browse this series on Market Realist:

• Part 2 - Why Potash Corporation May Report a Dull 3Q15
• Part 3 - What Could Impact Potash Corporation’s Shipments?
• Part 4 - Potash Corporation’s Valuation Multiple