Overall CF gets a fundamental rating of 7 out of 10. We evaluated CF against 83 industry peers in the Chemicals industry. Both the health and profitability get an excellent rating, making CF a very profitable company, without any liquidiy or solvency issues. CF is valued quite cheap, while showing a decent growth score. This is a good combination! CF also has an excellent dividend rating. These ratings would make CF suitable for value and dividend and quality investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

CF had positive earnings in the past year.
CF had a positive operating cash flow in the past year.
In the past 5 years CF has always been profitable.
In the past 5 years CF always reported a positive cash flow from operatings.

1.2 Ratios

The Return On Assets of CF (9.71%) is better than 93.98% of its industry peers.
CF has a Return On Equity of 28.44%. This is amongst the best in the industry. CF outperforms 96.39% of its industry peers.
CF has a better Return On Invested Capital (13.42%) than 90.36% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CF is significantly above the industry average of 6.11%.
The last Return On Invested Capital (13.42%) for CF is well below the 3 year average (20.79%), which needs to be investigated, but indicates that CF had better years and this may not be a problem.

		Industry Rank	Sector Rank
ROA	9.71%
ROE	28.44%
ROIC	13.42%

ROA(3y)14.93%

ROA(5y)10.97%

ROE(3y)39.12%

ROE(5y)31.36%

ROIC(3y)20.79%

ROIC(5y)16.71%

1.3 Margins

CF has a Profit Margin of 20.47%. This is amongst the best in the industry. CF outperforms 97.59% of its industry peers.
CF's Profit Margin has improved in the last couple of years.
CF has a better Operating Margin (31.03%) than 96.39% of its industry peers.
In the last couple of years the Operating Margin of CF has grown nicely.
With a decent Gross Margin value of 36.86%, CF is doing good in the industry, outperforming 74.70% of the companies in the same industry.
In the last couple of years the Gross Margin of CF has grown nicely.

		Industry Rank	Sector Rank
OM	31.03%
PM (TTM)	20.47%
GM	36.86%

OM growth 3Y-4.8%

OM growth 5Y7.21%

PM growth 3Y13.52%

PM growth 5Y13.82%

GM growth 3Y-1.74%

GM growth 5Y6.25%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), CF is creating some value.
CF has less shares outstanding than it did 1 year ago.
The number of shares outstanding for CF has been reduced compared to 5 years ago.
Compared to 1 year ago, CF has a worse debt to assets ratio.

2.2 Solvency

An Altman-Z score of 2.45 indicates that CF is not a great score, but indicates only limited risk for bankruptcy at the moment.
CF has a better Altman-Z score (2.45) than 63.86% of its industry peers.
CF has a debt to FCF ratio of 1.74. This is a very positive value and a sign of high solvency as it would only need 1.74 years to pay back of all of its debts.
With an excellent Debt to FCF ratio value of 1.74, CF belongs to the best of the industry, outperforming 90.36% of the companies in the same industry.
CF has a Debt/Equity ratio of 0.61. This is a neutral value indicating CF is somewhat dependend on debt financing.
CF's Debt to Equity ratio of 0.61 is in line compared to the rest of the industry. CF outperforms 54.22% of its industry peers.
Although CF does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.61
Debt/FCF	1.74
Altman-Z	2.45

ROIC/WACC0.98

WACC13.74%

2.3 Liquidity

CF has a Current Ratio of 2.27. This indicates that CF is financially healthy and has no problem in meeting its short term obligations.
CF's Current ratio of 2.27 is fine compared to the rest of the industry. CF outperforms 65.06% of its industry peers.
A Quick Ratio of 1.99 indicates that CF should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.99, CF is doing good in the industry, outperforming 78.31% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	2.27
Quick Ratio	1.99

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 36.27% over the past year.
Measured over the past years, CF shows a very strong growth in Earnings Per Share. The EPS has been growing by 24.81% on average per year.
CF shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 12.59%.
Measured over the past years, CF shows a small growth in Revenue. The Revenue has been growing by 5.28% on average per year.

EPS 1Y (TTM)36.27%

EPS 3Y13.85%

EPS 5Y24.81%

EPS Q2Q%65.67%

Revenue 1Y (TTM)12.59%

Revenue growth 3Y-3.17%

Revenue growth 5Y5.28%

Sales Q2Q%21.09%

3.2 Future

Based on estimates for the next years, CF will show a small growth in Earnings Per Share. The EPS will grow by 4.44% on average per year.
The Revenue is expected to grow by 1.82% on average over the next years.

EPS Next Y45.01%

EPS Next 2Y7.46%

EPS Next 3Y-0.09%

EPS Next 5Y4.44%

Revenue Next Year18.35%

Revenue Next 2Y5.5%

Revenue Next 3Y2.01%

Revenue Next 5Y1.82%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 11.27, which indicates a very decent valuation of CF.
Based on the Price/Earnings ratio, CF is valued cheaper than 85.54% of the companies in the same industry.
CF is valuated cheaply when we compare the Price/Earnings ratio to 28.39, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 12.86 indicates a correct valuation of CF.
Compared to the rest of the industry, the Price/Forward Earnings ratio of CF indicates a somewhat cheap valuation: CF is cheaper than 73.49% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of CF to the average of the S&P500 Index (25.72), we can say CF is valued slightly cheaper.

		Industry Rank	Sector Rank
PE	11.27
Fwd PE	12.86

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, CF is valued cheaply inside the industry as 95.18% of the companies are valued more expensively.
CF's Price/Free Cash Flow ratio is rather cheap when compared to the industry. CF is cheaper than 89.16% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	8.57
EV/EBITDA	4.91

4.3 Compensation for Growth

CF's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of CF may justify a higher PE ratio.

PEG (NY)0.25

PEG (5Y)0.45

EPS Next 2Y7.46%

EPS Next 3Y-0.09%

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5. Dividend

5.1 Amount

CF has a Yearly Dividend Yield of 2.24%.
CF's Dividend Yield is a higher than the industry average which is at 2.23.
CF's Dividend Yield is a higher than the S&P500 average which is at 1.82.

		Industry Rank	Sector Rank
Dividend Yield	2.24%

5.2 History

On average, the dividend of CF grows each year by 10.99%, which is quite nice.
CF has been paying a dividend for at least 10 years, so it has a reliable track record.
CF has not decreased their dividend for at least 10 years, which is a reliable track record.

Dividend Growth(5Y)10.99%

Div Incr Years3

Div Non Decr Years19

5.3 Sustainability

CF pays out 24.22% of its income as dividend. This is a sustainable payout ratio.
The dividend of CF is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.

DP24.22%

EPS Next 2Y7.46%

EPS Next 3Y-0.09%

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CF INDUSTRIES HOLDINGS INC / CF FAQ

What is the ChartMill fundamental rating of CF INDUSTRIES HOLDINGS INC (CF) stock?

ChartMill assigns a fundamental rating of 7 / 10 to CF.

What is the valuation status of CF INDUSTRIES HOLDINGS INC (CF) stock?

ChartMill assigns a valuation rating of 8 / 10 to CF INDUSTRIES HOLDINGS INC (CF). This can be considered as Undervalued.

How profitable is CF INDUSTRIES HOLDINGS INC (CF) stock?

CF INDUSTRIES HOLDINGS INC (CF) has a profitability rating of 9 / 10.

What are the PE and PB ratios of CF INDUSTRIES HOLDINGS INC (CF) stock?

The Price/Earnings (PE) ratio for CF INDUSTRIES HOLDINGS INC (CF) is 11.27 and the Price/Book (PB) ratio is 3.02.

Can you provide the expected EPS growth for CF stock?

The Earnings per Share (EPS) of CF INDUSTRIES HOLDINGS INC (CF) is expected to grow by 45.01% in the next year.