Reasons Why You Should Retain MOS Stock in Your Portfolio Now

The Mosaic Company MOS is benefiting from favorable demand for phosphate and potash, high-return investments and actions to improve its cost structure amid headwinds from input cost inflation.

MOS’s shares are down 3.6% in a year compared with the Zacks Fertilizers industry’s 38.3% rise.

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Let’s find out why MOS stock is worth retaining at the moment.

Healthy Demand & Cost Actions Aid Mosaic Stock

Mosaic is gaining from the strong demand for fertilizers, aided by favorable agricultural conditions. Attractive farm economics continue to drive demand for fertilizers globally. Farmer economics remain favorable in most global growing regions due to strong crop demand and affordable inputs. The phosphate market is benefiting from higher global demand and low producer and channel inventories. Strong demand and supply tightness have also led to an uptick in phosphate and potash prices.

Demand for grains and oilseeds remains high globally. Improved farmer affordability is also likely to continue to drive demand for fertilizers. Demand for phosphate and potash in North America is expected to be strong over the near term. Healthy farmer economics and improved affordability are likely to drive demand for fertilizers. Demand in Brazil is also expected to be driven by healthy grower economics, higher planted acres, increasing crop yields and growers’ need to replenish soil nutrients. Low inventory levels and pent-up purchases, backed by government support, are also expected to drive demand in India.

Demand and supply fundamentals remain favorable for phosphate amid China’s move to restrict exports to prioritize domestic consumption. Potash market remains balanced and Mosaic sees shipments in 2026 to reach record levels on healthy demand from major markets.

MOS’s actions to improve its operating cost structure through transformation plans are expected to boost profitability. Mosaic remains on track with its cost-reduction plan, which is expected to drive $250 million in run-rate cost reductions by the end of 2026, having already achieved $150 million in cost reduction targets in 2025, mostly in Fertilizantes. The additional cost reductions are expected to be realized through optimization of the supply chain, automation of administrative functions, absorption of fixed costs and operational cost cuts.

MOS also remains committed to carrying out investments with high returns and moderate capital expenditures. It has completed the 800,000-ton MicroEssentials capacity conversion. The Esterhazy Hydrofloat project, which added 400,000 tons in milling capacity, is complete and produced the first potash tons in July 2025, with ramp-up continuing. Hydrofloat will enable Mosaic to produce low-cost potash tons. The company sees record production in Esterhazy this year.

The construction of a new blending and distribution center in Palmeirante, Brazil, was also completed in July 2025, supporting the company’s long-term growth objectives in Brazilian agriculture markets. The facility is expected to enable Mosaic Fertilizantes to increase overall sales by 1 million tons.

Higher Input Costs Ail MOS

Mosaic uses sulfur and ammonia as key inputs for the production of phosphate. Supply disruptions contributed to the rise in prices of both sulfur and ammonia last year. Plant shutdowns and maintenance led to a tight supply of these raw materials, which, coupled with strong demand, pushed up their prices. Higher raw material costs led to an increase in the company’s production costs.

The impacts of raw material inflation are likely to be reflected in the company’s margins in 2026. MOS has witnessed a sharp increase in sulfur price since late 2025, which is expected to weigh on phosphate margins in the first quarter of 2026. The company expects the full impact of the sulfur price inflation to be reflected in the cost of goods sold in the second quarter. Easing ammonia prices are likely to provide some offset.

MOS’ Zacks Rank & Key Picks

MOS currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the Basic Materials space include DuPont de Nemours, Inc. DD, Compass Minerals International, Inc. CMP and Balchem Corporation BCPC.

While DD and CMP sport a Zacks Rank #1 (Strong Buy) each at present, BCPC carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for DD’s 2026 earnings is pegged at $2.28 per share, indicating an increase of 35.7% year over year. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 6.5%.

The Zacks Consensus Estimate for CMP’s current fiscal year earnings is pinned at 89 cents per share, indicating a 285.4% year-over-year increase. The Zacks Consensus Estimate for CMP’s current fiscal year earnings has been revised 27.1% upward over the past 60 days.

The Zacks Consensus Estimate for BCPC’s 2026 earnings is pinned at $5.47 per share, indicating a 6.2% year-over-year increase. The Zacks Consensus Estimate for BCPC’s 2026 earnings has been revised 1.1% upward over the past 60 days.

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DuPont de Nemours, Inc. (DD): Free Stock Analysis Report

The Mosaic Company (MOS): Free Stock Analysis Report

Balchem Corporation (BCPC): Free Stock Analysis Report

Compass Minerals International, Inc. (CMP): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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