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Nutrien (NTR) to Report Q1 Earnings: What's in the Cards?

Nutrien Ltd. NTR is set to release first-quarter 2023 results on May 10, after the closing bell.

The fertilizer maker delivered a negative earnings surprise of 13.9%, on average, over the trailing four quarters. It posted a negative earnings surprise of 23.2% in the last reported quarter. The company’s first-quarter performance will likely reflect the benefits of healthy demand for fertilizers. However, weaker fertilizer prices and higher natural gas costs are expected to have affected its performance.

NTR shares have lost 31.6% in the past year compared with the industry’s 29.5% decline.

 

Zacks Investment Research
Zacks Investment Research


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Let’s see how things are shaping up for this announcement.

 

What do the Estimates Indicate?

The Zacks Consensus Estimate for Nutrien’s first-quarter consolidated sales is currently pegged at $6,673 million, calling for a decline of 12.9% from the year-ago quarter’s tally.

The Zacks Consensus Estimate for sales in the Nutrien Ag Solutions segment currently stands at $3,745 million, suggesting a 3% year-over-year decline.

The consensus estimate for sales in the Phosphates segment is currently pegged at $601 million, calling for a year-over-year rise of 6.7%.

The consensus mark for sales in the Potash segment is currently pegged at $1,329 million, suggesting a year-over-year decline of 28.2%.

The Zacks Consensus Estimate for sales in the Nitrogen segment is currently pegged at $1,325 million, indicating a year-over-year decline of 9.4%.

A Few Factors to Watch

NTR is likely to have benefited from solid demand for fertilizers in the March quarter, backed by the strength in the global agricultural market. It is expected to have gained from healthy potash volumes on the back of high domestic and overseas demand and actions to boost potash production. Nutrien is also likely to have gained from acquisitions, cost efficiency and increased adoption of its digital platform.

However, the company is likely to have faced headwinds from higher natural gas prices. Natural gas is a major component in nitrogen production costs. Nutrien is seeing a rise in the cost of goods sold per ton for nitrogen due to higher natural gas costs. It is also facing headwinds from elevated raw material costs. Higher gas and input costs might have impacted the company’s margins in the March quarter.

Moreover, prices of phosphate and potash retreated in the back half of 2022 from their peak levels attained in the first half riding on the impacts of the Russia-Ukraine war and disruptions due to the sanctions in Belarus. Global nitrogen prices have declined since the beginning of 2023. Lower fertilizer prices are expected to have weighed on the company’s profitability in the first quarter.

 

Nutrien Ltd. Price and EPS Surprise

 

Nutrien Ltd. Price and EPS Surprise
Nutrien Ltd. Price and EPS Surprise

Nutrien Ltd. price-eps-surprise | Nutrien Ltd. Quote

 

Zacks Model

Our proven model does not conclusively predict an earnings beat for Nutrien this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: Earnings ESP for Nutrien is -3.03%. The Zacks Consensus Estimate for first-quarter earnings is currently pegged at $1.54. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Nutrien currently carries a Zacks Rank #5 (Strong Sell).

Stocks That Warrant a Look

Here are some companies in the basic materials space you may want to consider, as our model shows these have the right combination of elements to post an earnings beat this quarter:

Centerra Gold Inc. CGAU, slated to release earnings on May 15, has an Earnings ESP of +192.31%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The consensus estimate for Centerra Gold’s earnings for the first quarter is currently pegged at a loss of 4 cents. CGAU currently carries a Zacks Rank #2.

Osisko Gold Royalties Ltd OR, scheduled to release earnings on May 10, has an Earnings ESP of +8.53% and currently carries a Zacks Rank #3.

The Zacks Consensus Estimate for Osisko Gold’s first-quarter earnings has been revised 10% upward in the past 60 days. The consensus estimate for OR’s earnings for the first quarter is currently pegged at 11 cents.

Sandstorm Gold Ltd. SAND, slated to release earnings on May 10, has an Earnings ESP of +16.98%.

The Zacks Consensus Estimate for Sandstorm Gold’s earnings for the first quarter is pegged at 4 cents. SAND currently carries a Zacks Rank #2.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Sandstorm Gold Ltd (SAND) : Free Stock Analysis Report

Osisko Gold Royalties Ltd (OR) : Free Stock Analysis Report

Nutrien Ltd. (NTR) : Free Stock Analysis Report

Centerra Gold Inc. (CGAU) : Free Stock Analysis Report

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