Monday, September 21, 2009

Potash takes guidance down (POT)

AlphaNinja - Potash (POT), a fertilizer and industrial/animal products concern, took down full year guidance late Friday. The stock is off 5% this morning. The fertilizer stocks have seen huge volatility the past few months, as large deals at firesale prices impact the global market.

This is the second time in only 3months that the company has lowered guidance. Earnings originally were targeted at $11, and are now expected to come in around $3.50.

Potash points out that the current level of fertilizer in the ground MUST be replenished, or crop yields will be hurt for years to come. Pretty good selling point he's got there...

"Food production is an unending and long-term business," said PotashCorp President and Chief Executive Officer Bill Doyle. "Decisions related to fertilizer use today inevitably impact crop yields – and soil needs – for years to come. Although there are fluctuations in fertilizer demand, there is an essential need for our products that is based on science. The potash, phosphate and nitrogen being mined from the soil by current crops must be replaced to protect the world's future food production. As farmers around the world begin the lengthy process of replenishing nutrients in the soil, we anticipate a new wave of demand growth that will allow us to once again demonstrate the full potential of our company."

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