So far in 2010, we've seen Greece wobble and Goldman Sachs executives get grilled, but nothing's managed to derail this remarkable rally. At least one sector has been left out of the market's year-to-date rise, though. That's the fertilizer group, which numbers one member fewer now that CF Industries
At year's end, my decision was to avoid the group, and I haven't been given a reason to regret that call so far. While the early 2010 snap-back was stronger than I expected, with Agrium
Goldman Sachs (speak of the devil!) recently argued that farmers may dial back on fertilizer applications in the face of subdued profitability. Perhaps high corn prices will come to the rescue. Oops, I'm not supposed to focus on that. Let's just move along to the company guidance.
For the full year, PotashCorp sees global shipments of 50 tons of its namesake fertilizer, which represents a 50% boost from last year. The company's own potash sales should range from 7.4 million to 8 million metric tons, which is a slight positive tweak of January's projection. That should help the company earn somewhere about $5 per share.
On this projected earnings basis, the stock doesn't look particularly cheap, but as management noted, this is a recovery year, and PotashCorp is setting up for stronger future results. Given the oligopoly market structure of potash, a premium of some sort is probably warranted when it comes to PotashCorp, Mosaic
Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his Motley Fool CAPS profile or follow his articles using Twitter or RSS. The Motley Fool has a disclosure policy.