MOS: Fertilizer Demand And Phosphate Pricing Will Shape A Cautious Outlook

The analyst price target for Mosaic has been cut materially, from about $33.00 to $24.00. Analysts are factoring in weaker near term revenue growth amid softer fertilizer demand and phosphate pricing headwinds, despite some offsetting strength in margins and select business segments.

Analyst Commentary

Recent Street research reflects a more cautious tone on Mosaic, with a series of price target reductions and at least one notable downgrade. While ratings are mixed across the coverage universe, the direction of estimates and targets has generally moved lower, underscoring rising skepticism around the durability of earnings and the trajectory of fertilizer markets.

Bearish analysts are increasingly focused on softening phosphate and potash fundamentals, execution inconsistencies in key segments, and a less favorable macro backdrop for farmers. Even where ratings remain positive, trimmed price targets signal reduced conviction in near term upside and a greater emphasis on risk management for investors.

At the more negative end of the spectrum, JPMorgan shifted to a Neutral stance with a sharply lower price target, citing fragile U.S. phosphate demand, elevated input costs for sulfur and ammonia, and weaker projected EBITDA into 2026. Goldman Sachs also lowered its target while maintaining a Buy view, noting that strong Fertilizantes performance was more than offset by reduced phosphate sales volume guidance, which weighs on the growth narrative and valuation support.

Several neutral rated firms have also cut targets, arguing that Mosaic needs more consistent execution, particularly in phosphate, to close its valuation gap with peers. Others expect shares to remain rangebound as the industry enters a shoulder season characterized by demand deferrals, softer pricing and greater earnings uncertainty into 2025.

Bearish Takeaways

• Bearish analysts are cutting price targets, arguing that lower phosphate prices, fragile demand and rising input costs erode visibility on earnings and cap near term valuation upside.
• Concerns around inconsistent execution in phosphate and credit related challenges in Brazil are leading to estimate reductions and a view that Mosaic will struggle to narrow its valuation discount versus peers.
• Several research notes highlight demand deferrals and a weaker seasonal backdrop for fertilizers, raising the risk that volumes and pricing undershoot expectations and pressure growth assumptions.
• Lowered 2025 sales volume guidance and a more cautious outlook for EBITDA into 2026 reinforce the view that Mosaic’s growth profile is moderating, limiting multiple expansion potential even from current levels.

What's in the News

• President Trump is considering at least $10B in aid to U.S. farmers using tariff revenue. This move could support farm incomes and indirectly stabilize fertilizer demand for suppliers including Mosaic. (Wall Street Journal)
• The U.S. Department of Agriculture and Department of Justice have launched a joint antitrust review of seed and fertilizer suppliers. Mosaic shares are trading lower on concerns about potential regulatory action and pricing scrutiny. (Bloomberg)
• Mosaic reported that from July 1, 2025 to September 30, 2025 it repurchased zero shares, but confirmed completion of its previously authorized buyback, totaling 26.68 million shares or 8.05 percent of shares outstanding for about $1.07 billion. (Company disclosure)

Valuation Changes

• The fair value estimate has fallen significantly, from about $33.00 to $24.00, implying a materially lower intrinsic value assessment for Mosaic shares.
• The discount rate has risen slightly, from roughly 8.20 percent to about 8.58 percent, signaling a modest increase in perceived risk or required return.
• The revenue growth outlook has deteriorated sharply, shifting from an expected increase of roughly 0.43 percent to a projected decline of about 1.23 percent, reflecting weaker top line assumptions.
• Net profit margin expectations have improved meaningfully, moving from about 2.68 percent to approximately 4.74 percent, indicating a more favorable margin profile despite softer revenue.
• The future P/E multiple has compressed substantially, dropping from around 43.2x to about 18.0x, pointing to reduced valuation optimism for Mosaic’s forward earnings.