The Mosaic Company
MOS
$18.85
+0.59%
The Mosaic Company is one of the world's largest producers of concentrated phosphate and potash crop nutrients, operating phosphate rock mines in the United States, potash mines in Canada, and a major fertilizer distribution and retail business in Brazil through Mosaic Fertilizantes. As a vertically integrated agricultural inputs company, Mosaic occupies a critical position in global food security infrastructure, competing alongside peers like Nutrien and ICL Group in a market where scale, resource quality, and logistics networks determine competitive advantage. The current investor narrative has turned sharply negative, with the stock down nearly 44% over the past year as fertilizer prices have collapsed from 2022 peaks, and the company reported a significant Q2 2026 loss of $272.8 million. Recent headlines about the Strait of Hormuz closure stranding a third of global fertilizer supply briefly boosted sentiment in March 2026, but that tailwind has failed to materialize into sustained earnings improvement, and analysts have grown increasingly divided on the stock's trajectory.…
MOS
The Mosaic Company
$18.85
Investment Opinion: Should I buy MOS Today?
Rating: Hold. The core thesis is that Mosaic offers deep asset value and a potential supply-shock catalyst, but the near-term earnings and cash flow deterioration are too severe to justify a Buy. The analyst consensus is 'buy' with an average target of $26.66, implying 42.3% upside, but this appears stale given the recent quarterly loss of -$0.86 per share and negative free cash flow.
Supporting evidence: The stock trades at 0.63x book value and 0.63x sales, well below the 1.5–2.5x P/B typical for Basic Materials peers. Revenue declined 6.04% year-over-year in Q2 2026, and gross margin compressed to 7.60% from 17.25% a year earlier. Free cash flow is deeply negative at -$947.1 million TTM, and the dividend payout ratio of 51.86% may be unsustainable. However, the EV/EBITDA of 5.09x is low, and the 3.67% dividend yield offers some income while waiting for a recovery.
Risks and conditions: The biggest risks are a further decline in fertilizer prices, a dividend cut, and a breakdown below the 52-week low of $18.68. This Hold would upgrade to Buy if fertilizer prices stabilize and free cash flow turns positive, or if the stock drops below $17 (analyst low) with signs of a bottom. It would downgrade to Sell if Q3 2026 earnings show continued losses and the dividend is cut. Valuation verdict: The stock appears undervalued relative to its asset base and historical P/B range, but the discount may be justified by the deteriorating fundamentals, making it a value trap until a catalyst emerges.
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MOS 12-Month Price Forecast
Mosaic presents a classic value trap dilemma: the stock is cheap on asset-based metrics, but the earnings and cash flow deterioration are severe, and the near-term outlook is highly uncertain. The bull case hinges on a fertilizer price recovery, potentially catalyzed by supply disruptions, while the bear case points to continued losses and a potential dividend cut. The analyst consensus is bullish but appears stale, and the technical picture is extremely weak. I would upgrade to bullish if Q3 2026 earnings show a return to profitability and free cash flow turns positive, or if fertilizer prices show a sustained uptrend. I would downgrade to bearish if the company cuts its dividend or breaks below the 52-week low of $18.68 with no sign of a bottom.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on The Mosaic Company's 12-month outlook, with a consensus price target around $26.66 and implied upside of +41.4% versus the current price.
Average Target
$26.66
0 analysts
Implied Upside
+41.4%
vs. current price
Analyst Count
—
covering this stock
Price Range
$17 - $35
Analyst target range
Mosaic is covered by 18 analysts with a consensus recommendation of "buy" and a recommendation mean of 2.5 on a scale where 1 is a strong buy and 5 is a strong sell, indicating a moderately bullish tilt despite the stock's severe underperformance. The average target price of $26.66 implies a remarkable +42.3% upside from the current price of $18.74, which would represent a substantial recovery if achieved, though the consensus appears stale relative to the rapid deterioration in fundamentals. The estimated EPS average of $2.59 for the forward period stands in stark contrast to the trailing EPS of $0.07 and the most recent quarterly loss of -$0.86, suggesting that analysts are either expecting a dramatic turnaround or have not yet fully revised their models downward. The consensus leans bullish in aggregate, but the recent institutional ratings activity reveals significant divergence, with Freedom Broker downgrading to Sell in August 2026 after upgrading to Buy in June 2026, while JP Morgan maintains an Underweight rating and RBC Capital upgraded to Outperform in May 2026. The target price range spans from a low of $17.00 to a high of $35.00, representing a spread of over 100% between the most bearish and most bullish scenarios, which signals extremely high uncertainty about the company's trajectory. The high target of $35.00 implies a scenario where fertilizer prices recover sharply, perhaps driven by the Hormuz closure disrupting global supply chains and benefiting North American producers with local inputs, while the low target of $17.00 prices in continued margin compression, potential dividend cuts, and further deterioration in the Brazilian distribution business. The wide target spread and the recent downgrade activity suggest that analyst conviction is weak, and the consensus "buy" rating may be a lagging indicator that has not yet caught up with the company's rapidly deteriorating fundamentals. With 18 analysts covering the stock, Mosaic maintains adequate institutional coverage, but the divergence in ratings and the wide target range indicate that price discovery is inefficient and volatility is likely to remain elevated.
Bulls vs Bears: MOS Investment Factors
The bear case currently has stronger evidence, as the company is losing money, burning cash, and facing a severe pricing downturn with no clear catalyst for recovery. The bull case rests on deep asset value and a potential supply shock from the Hormuz closure, but these are speculative and have not yet translated into earnings. The single most important tension is whether fertilizer prices can stabilize before the company's cash flow turns sustainably positive; if they do not, the dividend and balance sheet could come under further pressure. Conversely, any sustained supply disruption or demand recovery could trigger a violent short squeeze given the 3.65 short ratio and 42% analyst upside. Investors are essentially betting on a commodity price recovery that is highly uncertain.
Bullish
- Deep value on asset base: MOS trades at just 0.63x book value and 0.63x sales, a steep discount to the 1.5–2.5x P/B typical for established Basic Materials producers. The EV/EBITDA of 5.09x is also low in absolute terms, suggesting the market is pricing in a permanent impairment of the company's phosphate and potash reserves.
- Analyst consensus sees 42% upside: 18 analysts have a consensus 'buy' rating (mean 2.5) with an average target price of $26.66, implying +42.3% upside from the current $18.74. The high target of $35.00 reflects a scenario where fertilizer prices recover sharply, potentially aided by supply disruptions like the Strait of Hormuz closure.
- Supply shock catalyst from Hormuz: The March 2026 closure of the Strait of Hormuz stranded a third of global fertilizer supply, creating a margin opportunity for North American producers with local inputs. While the tailwind has not yet materialized in earnings, any sustained disruption could tighten global markets and lift realized prices for Mosaic's phosphate and potash volumes.
- Low beta and short squeeze potential: With a beta of 0.918, MOS is less volatile than the broader market, yet it has fallen 43.96% over the past year. The short ratio of 3.65 indicates a meaningful short position that could fuel a sharp rally if any positive catalyst emerges, especially given the stock's 0.4% proximity to its 52-week low.
Bearish
- Earnings collapse into losses: Q2 2026 net income was -$272.8 million, a net margin of -9.66%, compared to positive net income of $410.7 million and a 13.66% net margin in Q2 2025. Gross margin compressed to 7.60% from 17.25% a year earlier, and operating margin turned negative at -1.26%, highlighting a severe squeeze between falling prices and fixed costs.
- Negative free cash flow and dividend risk: Trailing twelve-month free cash flow is -$947.1 million, and Q2 2026 free cash flow was -$152.9 million. Capital expenditures of $320.3 million exceeded operating cash flow of $167.4 million, forcing the company to fund the gap through financing. The 3.67% dividend yield, with a payout ratio of 51.86%, may be unsustainable if cash flow remains negative.
- Revenue decline accelerating: Q2 2026 revenue of $2.824 billion fell 6.04% year-over-year and was down sequentially from Q1 2026's $2.998 billion. The multi-quarter trend shows deceleration from Q3 2025's $3.452 billion peak, with all three segments—Phosphates, Potash, and Fertilizantes—under pressure from lower realized fertilizer prices.
- Analyst estimates appear stale: The forward EPS estimate of $2.59 stands in stark contrast to the trailing EPS of $0.07 and the most recent quarterly loss of -$0.86. This suggests analysts have not fully revised their models downward, and the consensus 'buy' rating may be a lagging indicator that fails to reflect the rapid deterioration in fundamentals.
MOS Technical Analysis
Mosaic is in a pronounced downtrend, with the stock down 43.96% over the past year and trading at just 18.74, which represents only 0.4% above its 52-week low of 18.68 and a staggering 41.9% below its 52-week high of 32.25. This positioning near the absolute bottom of the 52-week range signals that sellers remain firmly in control and that the stock is in a falling-knife scenario rather than a value opportunity, as the market continues to reprice fertilizer equities lower amid deteriorating fundamentals. The max drawdown of -47.84% underscores the severity of the decline, and with the current price sitting at approximately 0.4% of the range from the low, any meaningful recovery would require a substantial catalyst. Recent momentum has been catastrophic, with the stock down 28.50% over the past month alone, dramatically underperforming the S&P 500's +2.12% gain during the same period, resulting in a relative strength of -30.62%. The 3-month change of -12.88% and 6-month change of -24.31% confirm that the selling pressure is accelerating rather than stabilizing, and the most recent session saw a -5.02% single-day decline on volume of 13.9 million shares, indicating capitulation-style selling. This divergence between the stock's collapse and the broader market's advance suggests company-specific and sector-specific headwinds are overwhelming any macro tailwinds. Key technical support is established at the 52-week low of 18.68, and a breakdown below this level would likely trigger further selling pressure and potentially open the door to new multi-year lows. Resistance is formidable at the 52-week high of 32.25, but more immediately, the stock would need to reclaim levels around 21-22 to signal any short-term stabilization. With a beta of 0.918, Mosaic is slightly less volatile than the broader market, but this relatively low beta has not protected shareholders from the severe sector-specific downturn, and the short ratio of 3.65 suggests that short sellers have built a meaningful position that could fuel a squeeze if any positive catalyst emerges.
Beta
0.92
0.92x market volatility
Max Drawdown
-47.8%
Largest decline past year
52-Week Range
$18-$32
Price range past year
Annual Return
-37.9%
Cumulative gain past year
| Period | MOS Return | S&P 500 |
|---|---|---|
| 1m | -25.2% | +1.8% |
| 3m | -17.8% | +3.5% |
| 6m | -20.6% | +11.2% |
| 1y | -37.9% | +19.1% |
| ytd | -24.7% | +14.1% |
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MOS Fundamental Analysis
Mosaic's revenue trajectory has deteriorated sharply, with Q2 2026 revenue of $2.824 billion representing a 6.04% year-over-year decline from Q2 2025's $3.006 billion, and the multi-quarter trend shows concerning deceleration from Q3 2025's $3.452 billion peak. The revenue decline is broad-based across segments, with the Phosphates segment generating $1.246 billion, Mosaic Fertilizantes contributing $1.034 billion, and Potash adding $650.3 million in the most recent quarter, but all three segments are under pressure from lower realized fertilizer prices. The year-over-year revenue decline of 6.04% combined with the sequential drop from Q1 2026's $2.998 billion suggests that pricing headwinds are intensifying, and the investment case now hinges on whether fertilizer prices can stabilize before the company's cost structure erodes further. Profitability has collapsed dramatically, with Q2 2026 net income of -$272.8 million representing a net margin of -9.66%, a stark reversal from Q2 2025's positive net income of $410.7 million and 13.66% net margin. Gross margin compressed to just 7.60% in Q2 2026, down from 17.25% in Q2 2025 and 15.99% in Q3 2025, reflecting the severe squeeze between falling selling prices and relatively fixed production costs. The operating margin of -1.26% in Q2 2026, compared to +8.13% in Q2 2025, illustrates how quickly the company swung from profitable to loss-making, and with SG&A expenses of $131.6 million and interest expense of $62.8 million, the company's cost base remains substantial even as revenues decline. The balance sheet shows some resilience with a debt-to-equity ratio of 0.437 and a current ratio of 1.315, but the cash flow situation is alarming, with trailing twelve-month free cash flow of -$947.1 million and Q2 2026 free cash flow of -$152.9 million. Capital expenditures of $320.3 million in Q2 2026 continue to exceed operating cash flow of $167.4 million, forcing the company to fund the gap through financing activities, and the ROE of 4.47% and ROA of 1.24% are well below what would be considered healthy for a capital-intensive materials company. The dividend payout ratio of 51.86% and dividend yield of 3.67% may be at risk if cash flow remains negative, as the company paid $69.9 million in dividends in Q2 2026 while generating negative free cash flow.
Quarterly Revenue
$2.8B
2026-06
Revenue YoY Growth
-6.0%
YoY Comparison
Gross Margin
7.6%
Latest Quarter
Free Cash Flow
$-947100000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is MOS Overvalued?
Since Mosaic reported positive trailing net income of $0.07 per share, the PE ratio is the appropriate primary valuation metric, and the trailing PE of 14.17x appears superficially reasonable until one recognizes that this is based on barely positive earnings that are rapidly deteriorating. The forward PE of 11.89x is lower than the trailing PE, which would normally suggest the market expects earnings growth, but this forward estimate of $2.59 in EPS appears wildly optimistic given that the company just reported a quarterly loss of -$0.86 per share and has negative trailing twelve-month free cash flow. The gap between trailing and forward PE implies the market is pricing in a dramatic earnings recovery that seems increasingly unlikely given the current pricing environment. On a price-to-book basis, Mosaic trades at just 0.63x book value, a significant discount that reflects the market's skepticism about the carrying value of the company's assets, while the price-to-sales ratio of 0.63x and EV-to-sales of 1.00x suggest the market values the entire enterprise at roughly one times annual revenue. Compared to the broader Basic Materials sector, where price-to-book ratios typically range from 1.5x to 2.5x for established producers, Mosaic's 0.63x P/B represents a discount of approximately 58-75%, which could indicate deep value or a value trap depending on whether fertilizer prices recover. The EV-to-EBITDA of 5.09x is low in absolute terms but reflects the depressed EBITDA base, and the PEG ratio of 0.068 is misleadingly attractive because it is calculated off a near-zero earnings base. Historically, Mosaic's PE ratio has ranged from 4.1x in mid-2022 during the fertilizer boom to over 57x in early 2024 during an earnings trough, and the current 14.17x sits in the middle of that range but is trending toward the higher end as earnings collapse. The price-to-book ratio of 0.63x is near the low end of its historical range, which has generally oscillated between 0.59x and 2.09x over the past five years, suggesting the market is pricing in significant asset impairments or sustained low fertilizer prices. The current valuation reflects a market that is deeply skeptical of the company's earnings power, and without a clear catalyst for fertilizer price recovery, the stock could remain range-bound at these depressed levels.
PE
14.2x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 4x~12x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
5.1x
Enterprise Value Multiple
Investment Risk Disclosure
Financial and operational risks are acute. Mosaic reported a Q2 2026 net loss of $272.8 million and negative free cash flow of -$947.1 million over the trailing twelve months, while capital expenditures of $320.3 million exceeded operating cash flow of $167.4 million. The company's debt-to-equity ratio of 0.437 and current ratio of 1.315 provide some cushion, but the dividend payout ratio of 51.86% and 3.67% yield are at risk if cash flow remains negative. Additionally, revenue is concentrated in three segments—Phosphates ($1.246B), Fertilizantes ($1.034B), and Potash ($650.3M)—all of which are experiencing price-driven declines, leaving little diversification to offset weakness.
Market and competitive risks are significant. The stock trades at a premium to its own historical P/B range? Actually, at 0.63x P/B it is near the low end of its five-year range of 0.59x to 2.09x, but the sector average P/B of 1.5–2.5x suggests a discount that could persist if fertilizer prices stay depressed. With a beta of 0.918, Mosaic is slightly less volatile than the market, but it has underperformed the S&P 500 by 59.96% over the past year, highlighting sector-specific headwinds. The recent Hormuz closure briefly boosted sentiment, but the tailwind has not translated into sustained earnings improvement, and competitive pressures from Nutrien and ICL Group could limit pricing power.
Worst-case scenario: A continued decline in fertilizer prices, coupled with a breakdown below the 52-week low of $18.68, could trigger further selling and push the stock toward the analyst low target of $17.00. From the current price of $18.74, that represents a downside of approximately -9.3%. However, if the dividend is cut and the company reports another large quarterly loss, the stock could fall to new multi-year lows, potentially testing the $15 level, which would be a -20% decline. The max drawdown of -47.84% over the past year illustrates the severity of the decline, and without a clear catalyst, the stock could remain in a downtrend.
FAQ
The most severe risk is financial: Mosaic is burning cash with negative free cash flow of -$947.1 million TTM and may be forced to cut its dividend (payout ratio 51.86%). Operational risk includes revenue concentration in three segments that are all declining, with Q2 2026 revenue down 6.04% year-over-year. Market risk is high due to the stock's severe downtrend, down 43.96% over the past year and trading near its 52-week low, with a beta of 0.918 not providing much protection. Company-specific risk includes the potential for further earnings losses and a breakdown below the 52-week low of $18.68, which could trigger technical selling. Additionally, competitive pressures from Nutrien and ICL Group could limit pricing power.
The 12-month forecast is highly uncertain. The base case (50% probability) sees a target range of $22–$27, assuming fertilizer prices stabilize and the company returns to modest profitability. The bull case (25% probability) targets $30–$35, driven by a supply shock from the Strait of Hormuz closure or other disruptions. The bear case (25% probability) targets $15–$18, if prices continue to fall and the dividend is cut. The most likely scenario is the base case, with a key assumption that fertilizer prices bottom out and remain range-bound. However, the wide analyst target range of $17 to $35 reflects significant disagreement, and the stock could remain volatile.
MOS appears undervalued on asset-based metrics, trading at 0.63x book value and 0.63x sales, well below the 1.5–2.5x P/B typical for Basic Materials peers. The EV/EBITDA of 5.09x is also low, but this reflects a depressed EBITDA base. The trailing PE of 14.17x is based on barely positive earnings, and the forward PE of 11.89x assumes a recovery that may not materialize. Compared to its own historical P/B range of 0.59x to 2.09x, the stock is near the low end, suggesting the market is pricing in significant asset impairments or sustained low fertilizer prices. The valuation implies the market expects no near-term recovery, so any positive catalyst could lead to a re-rating.
MOS is not a good buy for most investors right now due to its deteriorating fundamentals, including a Q2 2026 net loss of $272.8 million and negative free cash flow of -$947.1 million TTM. However, for deep-value contrarians, the stock trades at just 0.63x book value and offers 42.3% upside to the analyst average target of $26.66. The biggest downside risk is a break below the 52-week low of $18.68, which could lead to further losses. It may be suitable for investors with a high risk tolerance and a long time horizon who believe fertilizer prices will recover. A safer entry point would be after evidence of margin stabilization or positive free cash flow.
MOS is more suitable for long-term investment by contrarian value investors, given its cyclical nature and the current downturn. The company's assets are long-lived, and global food demand is inelastic, so a recovery in fertilizer prices could lead to substantial gains over a 3–5 year horizon. However, the near-term outlook is bleak, with negative free cash flow and a potential dividend cut, making it a poor choice for short-term trading unless one is betting on a technical bounce or a short squeeze. The beta of 0.918 suggests lower volatility than the market, but the stock has been highly volatile due to sector-specific factors. A minimum holding period of 2–3 years is recommended to ride out the cycle, and investors should be prepared for further downside before a recovery.