- If you are wondering whether Mosaic's current share price offers real value or just looks cheap on the surface, this breakdown is designed to help you make sense of it.
- The stock recently closed at US$23.30, with returns over the last year declining 34.1%, while the 30 day move shows a modest gain of 1.4% and the year to date return is down 6.9%.
- Recent coverage around Mosaic has focused on its position in the materials sector and how investors are reassessing risk and opportunity in fertilizer producers. This context helps explain why the stock has seen both shorter term stability and longer term weakness, as sentiment has shifted between caution and interest.
- Mosaic currently has a valuation score of 5, based on passing 5 of 6 undervaluation checks. The next sections will walk through those methods step by step, and will also point to a more complete way of thinking about value at the end of the article.
Find out why Mosaic's -34.1% return over the last year is lagging behind its peers.
Approach 1: Mosaic Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow, or DCF, model estimates what a stock could be worth by projecting the company’s future cash flows and discounting them back to today’s value using a required return.
For Mosaic, the model used is a 2 Stage Free Cash Flow to Equity approach based on cash flow projections. The latest twelve month free cash flow is a loss of about $501.6 million, so the DCF relies on expected future free cash flows rather than recent results. Analyst inputs and subsequent extrapolations point to free cash flow of $325.9 million in 2026 and $594.86 million in 2027, with projections rising toward about $890.36 million by 2035. Simply Wall St extrapolates the later years after the initial analyst forecast window.
When these projected cash flows are discounted back, the model arrives at an estimated intrinsic value of about $39.49 per share. Compared with the recent share price of $23.30, this suggests Mosaic trades at roughly a 41.0% discount under this DCF framework.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Mosaic is undervalued by 41.0%. Track this in your watchlist or portfolio, or discover 47 more high quality undervalued stocks.
Approach 2: Mosaic Price vs Sales
For companies that generate revenue consistently, the P/S ratio is a useful way to see how much investors are paying for each dollar of sales, especially when earnings can be volatile or impacted by non cash items.
What counts as a “normal” P/S ratio often reflects the market’s expectations for future growth and the level of risk. Higher growth and lower perceived risk usually support a higher multiple, while slower growth or higher risk tend to justify a lower one.
Mosaic currently trades on a P/S ratio of 0.60x. That is below both the Chemicals industry average P/S of 1.10x and the peer group average of 1.22x. Simply Wall St also calculates a “Fair Ratio” for Mosaic of 0.93x. This is the P/S level suggested by factors such as its earnings growth profile, industry, profit margins, market cap and risk characteristics.
This Fair Ratio is more tailored than a simple comparison with peers or the wider industry because it adjusts for Mosaic’s specific growth, risk and profitability rather than assuming all companies should share the same benchmark. With Mosaic trading at 0.60x versus a Fair Ratio of 0.93x, the stock appears undervalued on this metric.
Result: UNDERVALUED
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Upgrade Your Decision Making: Choose your Mosaic Narrative
Earlier it was mentioned that there is an even better way to understand valuation. Narratives are introduced here as your short, plain language story about Mosaic that connects your view of its business to a set of numbers such as future revenue, earnings, margins and a fair value estimate. On Simply Wall St’s Community page you can see different Narratives side by side. For example, one prices Mosaic at about US$19.36 because it focuses on regulatory pressure and weaker phosphate margins, and another prices it closer to US$40.00 because it leans on margin recovery and tighter fertilizer supply. You can compare each Fair Value to today’s share price and, as news or earnings arrive and those inputs refresh, see the Narrative update automatically and decide which story best fits how you want to act on the stock.
For Mosaic however we will make it really easy for you with previews of two leading Mosaic Narratives:
Start with the narrative that sees Mosaic as undervalued, then compare it with the more cautious bear case. The gap between them shows you what really matters for your own view, things like how you see fertilizer demand, regulation, margins and the impact of the DOJ probe.
Fair value: US$30.43
Implied discount to this fair value at US$23.30: about 23.5% below the narrative fair value.
Analyst model revenue growth used in this narrative: about 2.48% a year.
- Assumes operational improvements, cost reductions and a tilt toward premium and biosciences products support higher margins over time.
- Builds on the view that tight fertilizer supply and firm agricultural demand can support pricing and help stabilize earnings.
- Aligns with the analyst consensus price target, with US$30.43 as the central fair value and a wide range of outcomes either side of that figure.
Fair value: US$19.36
Implied premium to this fair value at US$23.30: about 20.4% above the narrative fair value.
Analyst model revenue growth used in this narrative: revenue is assumed to decline about 3.17% a year.
- Assumes rising environmental and regulatory costs, plus remediation obligations, keep pressure on margins for longer.
- Builds in weaker demand for traditional fertilizers as farmers adopt lower volume methods and more bio based alternatives.
- Anchors fair value at the lower end of analyst targets, with US$19.36 used to reflect a more cautious earnings and revenue path.
Both narratives rely on explicit forecasts and valuation inputs, but they tell very different stories about Mosaic's future earnings power, pricing and risk profile. Your next step is to decide which story, or combination of stories, lines up more closely with how you see the fertilizer sector, Mosaic's competitive position and your own risk tolerance.
To weigh those trade offs in more detail and see how other investors are thinking about Mosaic's valuation and risks, have a look at the full range of Community Narratives and valuation tools on Simply Wall St, then decide where this stock fits, if at all, in your portfolio.
To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Mosaic on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.
Do you think there's more to the story for Mosaic? Head over to our Community to see what others are saying!
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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