Daily Stock Pick: Compass Minerals

This week, I'm looking for the seventh materials representative of nine for my Ivy portfolio.

That basic materials sector has thirteen industries all related to mining, making, and delivering essential commodities. They are: agricultural inputs; aluminum; building materials; chemicals; coal; copper; industrial metals; gold; paper; silver; specialty chemicals; steel.

Today I'm reviewing a small-cap industrial metals and minerals company named Compass Minerals International Inc. Their trading ticker symbol is CMP.  I last reported on this company on May 9th.

Compass Minerals produces two primary products: salt and sulfate of potash, a specialty fertilizer. The company's main assets include rock salt mines in Ontario, Louisiana, and the United Kingdom and salt brine operations at the Great Salt Lake in Utah.

Compass' salt products are used for deicing and also by industrial and consumer end markets. The firm's fertilizer products are used by growers of high-value crops that are sensitive to standard potash.

The company was formerly known as Salt Holdings Corporation and changed its name to Compass Minerals International, Inc. in December 2003. Compass Minerals International, Inc. was founded in 1993 and is headquartered in Overland Park, Kansas.

I use three key data points to gauge dividend-paying equities or funds like Compass Minerals International Inc:

(1) Price

(2) Dividends

(3) Returns

Besides those three, several other keys will finally unlock an equity or fund in which to invest.

Those three basic keys, however, best tell whether a company has made, is making, and will make money.

CMP Price

Compass's price per share closed at $57.34 yesterday. A year ago its price was $68.20. Price fell $10.86 or near 16% in the past year.

Assuming Compass's stock trades in the range of $40.00 to $70.00 this year, Compass's recent $57.34 price could rise by $4.66 and go to $62.00 by late-July, 2020.

CMP Dividends

Compass's most recent quarterly dividend is $0.72 paid June 14th.

That $0.72 Q payout equates to an annual dividend of $2.88 generating a yield of 5.02% based on yesterday's $57.34 closing price.

Gains For CMP?

Adding the $2.60 annual estimated dividend to my $4.66 estimate of Compass's price upside shows a $7.26 potential gross annual gain, per share, which will be reduced by costs to trade those shares.

Say we pay a little under $1,000.00 today at the $57.34 recent stock price, we'd buy 17 Compass Minerals International Inc shares.

A $10 broker fee paid half at purchase and half at sale will cost us $0.59 per share.

Subtract that $0.59 brokerage cost from the estimated $6.67 gross annual gain leaves a net gain of $6.08 X 17 shares = $103.36 or a 10.35% net gain on a $974.78 investment.

Therefore, Compass Minerals International Inc whose trading ticker symbol is CMP now shows a possible net gain of 10.35% including a 5.02% dividend yield.

Ten brokers track Compass Minerals International Inc stock:

Three say "Buy" CMP.

Two say CMP will "Outperform" its peers.

Four say "Hold" your CMP Shares.

One says CMP will "Underperform" its peers.

Their consensus score of 2.3 equates to "outperform."

Now we can look at Compass Minerals International Inc and see it has made money, is making money, and could net a 10.35% gain including a 5.02% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. The actual results remain to be seen to learn if  Compass Minerals International Inc is worth your time and money.