MOS

Mosaic is one of the world's largest producers of potash and phosphate crop nutrients, a deeply cyclical commodity business. FY2025 marked a recovery from a weak FY2024: revenue grew 8.4% to $12.1B, gross profit rose 25.8%, operating income climbed 32.2% to $822M, and net income tripled (+209.1%) to $541M, with diluted EPS of $1.70. Even so, margins remain thin — a 15.8% gross margin, 6.8% operating margin and 4.5% net margin — and ROE is just 4.5%, well below the company's peak-cycle returns. The history makes the cyclicality explicit: net income ran $1.63B, $3.58B, $1.16B, $175M and now $541M, swinging with global fertilizer prices.

Valuation reflects the commodity character: at $22.90 the stock trades at a 13.5 P/E and just 0.6x sales, and with $12.1B of equity (retained earnings $14.2B) the shares sit near or below book value. The balance sheet is reasonable, but cash is thin at $277M and operating cash flow fell 36.5% to $825M — barely covering the elevated $1.36B capex (up 8.6%), which pressures free cash flow. The company paid $280M of dividends (up 3.6%) but did no buybacks.