Mosaic Co (MOS): This Mining Option Appears Worth Digging Into

Rio Tinto plc (ADR) (NYSE:RIO), another diversified mining company, likewise appears on the same path as it announced imminent sale of its U.S. nickel and copper mining project in Michigan to Toronto-based Lundin Mining for $325 million. This deal is reportedly just the first of a series of divestments in order to boost Rio Tinto plc (ADR) (NYSE:RIO)’s balance sheet.

In contrast to these asset divestments, Mosaic recently entered into a phosphates joint venture with a leading mining and metals company in Saudi Arabia, Ma’aden. This JV will create a new phosphate production facility with a 3-million-ton capacity expected to be operational by 2016. This JV will give Mosaic between 800,000 tons and 900,000 tons of additional products.

A solid wrap-up

Wrapping it up, Mosaic Co (NYSE:MOS) looks like a good buy with the organic growth initiatives it is taking and its advantage of already having focus on its core businesses of potash and phosphates. Additionally, its 1.70% annual dividend yield looks attractive, and its current P/E ratio of around 13 seems inexpensive. Also, the company’s balance sheet stands rock solid with total cash of $3.32 billion and $1.07 billion total debt as of Mosaic’s most recent quarter.

The article This Mining Option Appears Worth Digging Into originally appeared on Fool.com and is written by Arturo Cuevas.

Arturo Cuevas has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Arturo is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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