I wish I would have bought some POT yesterday.
Potash Corp. stock jumps on news of higher earnings
CALGARY, Sept 19 (Reuters) - Shares in Potash Corp. of
Saskatchewan Inc. <POT.TO> jumped nearly 9 percent on Tuesday
after the world's top fertilizer producer said its
third-quarter profits would beat analysts' expectations by a
wide margin.
Potash Corp. was up C$6.50 to C$79 on the Toronto Stock
Exchange on Tuesday, a day after the company said higher
nitrogen prices, its natural-gas hedging program and strong
global potash sales would allow it to generate earnings of 70
cents a share in the quarter, compared to previous expectations
of 41 cents.
The stock price is up from a low of C$61.50 set in early
March.
In New York, Potash Corp. <POT.N> was up $4-5/16 to
$53-3/16 on Tuesday.
The Saskatoon, Saskatchewan-based company also said on
Monday its full-year earnings would beat a current estimate of
$3 a share by 10 percent if market conditions remained strong.
Sam Kanes, analyst with Scotia Capital Markets in Toronto,
said he had been looking for Potash Corp. to generate 40 cents
a share in the third quarter, but pointed out the company beat
expectations in the first and second quarters as well.
Fears over soaring natural gas prices throughout North
America as well as an outlook for weak grain futures amid a
strong U.S. harvest had caused the stock to languish all
summer, Kanes said.
Tight industry-wide nitrogen fertilizer inventories have
lifted average prices by more than 40 percent from the third
quarter of 1999, Potash Corp. said.
It also said it reaped rewards from its U.S. gas hedging
program and ability to supply North American demand
from low-cost output in Trinidad.
Potash Corp. said it had cut 25 percent of its ammonia
production at its Geismar, Louisiana, facility and was
substituting cheaper feedstock from Trinidad.
The company's gas hedging program has allowed it to pay
levels 40 percent below the current NYMEX spot gas price for
nearly two-thirds of its needs in 2000, it said. It is hedged
at a similar price for almost half its requirements next year.
($1=$1.49 Canadian)
((Jeffrey Jones, Reuters Calgary bureau (403) 531-1624,
jeff.jones@reuters.com))
REUTERS
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