10 Undervalued Stocks to Invest in According to Goldman Sachs

4. The Mosaic Company (NYSE:MOS)

Forward P/E ratio: 12.52

Number of Hedge Fund Holders: 41

The Mosaic Company (NYSE:MOS) is a leading producer and marketer of concentrated phosphate and potash crop nutrients, essential for global agriculture. It operates mining, production, and distribution facilities in North America and South America, supplying fertilizers to farmers, cooperatives, and industrial customers worldwide. MOS’s key products include phosphate-based fertilizers like diammonium phosphate (DAP) and monoammonium phosphate (MAP), as well as potash fertilizers used to enhance soil fertility. The company leverages vertically integrated operations, global logistics, and strategic partnerships to optimize production and distribution. It also invests in sustainability initiatives, including water conservation, energy efficiency, and responsible mining practices.

The Mosaic Company (NYSE:MOS) reported Q4 2024 net income of $169 million and adjusted EBITDA of $594 million, with strong phosphate prices and stripping margins, solid potash performance, and excellent underlying business performance in Brazil. The company expects constructive agricultural and fertilizer market fundamentals in 2025, supported by strong global corn demand and rising crop prices. In operational progress, the Esterhazy complex continues to generate strong cash flow, while Belle Plaine delivered record production in 2024. The company is expanding capacity through projects including a 500,000-tonne compaction capacity increase and a Hydrofloat project adding 400,000 tonnes annually. In the phosphate segment, supply remains tight and demand strong, with prices and stripping margins significantly above historic levels.

The Mosaic Company (NYSE:MOS) has secured long-term ammonia supply through three contracts, ensuring reliable supply at competitive rates. The Brazil business demonstrates strong underlying performance despite market headwinds, with distribution margins at the high end of the annual normalized range. Strategic progress includes the pending sale of the Patos de Minas site and the Ma’aden transaction, which provided a transparent value of about $1.5 billion and a $522 million gain. The company’s cost reduction initiatives are showing good progress, with expectations to reach the $150 million target. Looking ahead, management expects phosphate production volumes to improve throughout the year, reaching 7.2 million to 7.6 million tonnes for the year. With a forward P/E ratio of 12.52, MOS is one of Goldman Sachs’s undervalued stocks.