CF Industries Shares Grew 75% Last Year. And Now?

This week I'm seeking a high-yield and growing stock from the basic materials sector. 

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

Today I'm reviewing a large-cap agricultural inputs firm named CF Industries Holdings, Inc. It's trading ticker symbol is CF.

CF Industries Holdings Inc is a leading producer and distributor of nitrogen fertilizers. The company operates various nitrogen facilities in America UK, and Canada. It primarily serves the international agriculture sector.

The company operates through Ammonia, Granular Urea, UAN, AN, and Other segments. Its principal nitrogen fertilizer products include ammonia, granular urea, urea ammonium nitrate, and ammonium nitrate. 

The company also offers diesel exhaust fluid, urea liquor, nitric acid, and aqua ammonia, as well as compound fertilizer products with nitrogen, phosphorus, and potassium. 

It offers products primarily to cooperatives, independent fertilizer distributors, farmers, and industrial users. 

CF Industries Holdings, Inc. was founded in 1946 and is headquartered in Deerfield, Illinois.

I use three key data points to gauge the value of any dividend equity or fund likeCF Industries Holdings, Inc. (CF): 

(1) Price

(2) Dividends

(3) Returns

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

But those first three primary keys, best tell whether a company has made, is making, and will make money. 

CF Price

CF's price per share was $51.53 at yesterday's market close. A year ago its price was $28.99 for a gain of $22.54 per share.  

Assuming CF's price will trade in the range of $40 to $75 next year, perhaps about half that $22.50 gain could repeat in the coming year and move CF's current $51.53 price to $63 by the last day of August, 2019. 

CF Dividends

CF's most recent quarterly dividend was $0.30 declared July 11th and paid out today August 31st. At this most recent quarterly pay rate,CF's annual dividend is calculated at $1.20 yielding 2.33% at yesterday's closing $51.53 price.

Gains For CF?

Adding the $1.20 estimated annual dividend to the nearly $12.50 year over year price gain for UFS makes a $13.70gross annual per share gain, which will be reduced by costs to trade the shares.  

A little under $1,000.00 invested today at the $51.53 recent price buys 19 CF Industries Holdings, Inc. (CF) shares. 

A $10 broker fee paid half at purchase and half at sale costs $0.53 per share, subtracting that $0.53 brokerage cost from the estimated $13.70 gross gain leaves a net gain of $13.17 X 19 shares = $250.23 or a 25% net gain on a $979.07 investment.

Therefore, CF Industries Holdings, Inc. whose trading ticker symbol is CF now shows a possible 25% net gain including a 2.33% dividend yield. 

Twenty brokers cover this stock:

Five say "buy" CF

Three say CF will "outperform" its peers.

Eleven analysts say "Hold" your position on CF.

Oh! and one saysCF will "underperform" its peers!

Thus, the analyst consensus recommendation number is 2.4 or "outperform".

The median price target set by those twenty brokers is $2.00 under the current price and $14 under my estimated upside number.

Here I am more optimistic than the brokers again!But Basic Materials has been the best performing sector in the Safari portfolio this year with no losers!

So, you could look at all those various numbers this way, CF Industries Holdings, Inc. (CF) has made money, is making money, and could net a 25% net annual gain including a 2.33% dividend yield. It could be more, it could be less. 3.34% dividend yield. It could be more, it could be less.

The above speculation is based on past year performance. Actual results remain to be seen. Those results will determine if CF Industries Holdings, Inc. (CF) is worth your time and money.

Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...

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