RE:CIBC NotesMy $59.02 bId got hit at the end of day for 500 shrs to add to my core for a trade after positive earnings (HOPEFULLY). Plan on dumping tomorrow at $63 on, as always light trading volumes. We will aee - my largest position again till tomorrow - Rolling the dice.
retiredcf wrote: EQUITY RESEARCH
May 7, 2023 Industry Update
Thoughts Ahead Of NTR / AFN / CHE.UN
Q1/23 Reporting
Key Points
NTR, AFN and CHE.UN report results this coming week. We summarize our
expectations below in light of several key crop input (CF, MOS, CTVA, IPI,
Yara), ag. equipment (AGCO, CNH), and chlor-alkali (WLK, OLN) companies
having already reported Q1/23 results.
NTR reports May 10, after market close. We forecast adj. EBITDA of
$1.69B vs. consensus of $1.67B. The focus for Q1/23 results will be on
possible revisions to NTR’s 2023 adj. EBITDA ($8.4B-$10.0B) and adj. EPS
guidance ($8.45-$10.65). Note that our latest estimates currently sit at the
low end of NTR’s guidance ranges, and we would not be surprised to see a
reduction in F2023 guidance. CF’s results highlight that urea and UAN
nitrogen offset weakness in ammonia results. MOS’s Q1/23 results showed
better-than-expected Potash segment results, but Q2/23 pricing guidance
was weaker than our prior expectations. CTVA’s results highlight that Seed
and Crop Protection results are likely to remain strong (due to pricing).
AFN reports May 8, after market close. We forecast adj. EBITDA of
$52.4MM, ahead of consensus $50.1MM, and up 27% Y/Y. We expect the
company to post mid-teens organic revenue growth in Q1/23, boosted by
Canada and ongoing strength in international markets such as Brazil and
India. We also expect a positive contribution from the U.S., though growth
should moderate relative to robust comparable 2022 results. Though not
exact comparables to AFN, AGCO’s and CNH’s Ag. Equipment segments
both reported solid Q1/23 results and provided constructive outlooks for the
global ag. equipment market. AGCO’s sales were up 24% Y/Y in Q1/23
(North America +32.4%, South America +42.2% on a constant currency
basis), and CNH’s Ag. Equipment sales were up +16% Y/Y. Both companies
raised their F2023 sales outlook.
CHE.UN reports May 10, after market close. We forecast adj. EBITDA of
$107MM, ahead of consensus $101MM, and flat Y/Y. While Northeast Asian
caustic prices are down YTD 2023, CHE.UN’s Q1/23 realized price should
remain relatively strong given that it lags spot prices. Further, chlorine pricing
has been slightly stronger and chlorate margins should be strong. The focus
for CHE.UN’s Q1/23 results will be on 2023 guidance, in light of the recent
decline in caustic pricing. Note, CHE.UN is more exposed to Northeast
Asian caustic prices, while WLK/OLN are more exposed to U.S. prices.
WLK’s Performance and Essential Materials segment beat Q1/23
expectations, partially driven by higher selling prices for both chlorine and
caustic soda in North America. WLK indicated it believes Asia caustic prices
have bottomed, and it is seeing signs of improvement.