CF Industries: It's Still Underpriced Despite The Rally

Danil SeredaInvesting Group LeaderFollow5ShareSavePlay(10min)Comments(2)SummaryCF Industries Holdings, Inc. remains a 'buy' despite a 67% YTD rally.As a low-cost North American producer, CF maintains a significant competitive advantage over European and Asian peers currently struggling with exponentially higher natural gas costs.The company generated $2.75 billion in operating cash flow in 2025, enabling the completion of a $3 billion buyback and the authorization of another $2 billion.Inland U.S. ammonia prices reaching $850 per ton suggest a potential $2.6 billion annualized EBITDA tailwind, far exceeding management’s conservative mid-cycle 2030 financial targets.Despite a 67% year-to-date rally, CF trades at a forward EV/EBITDA of roughly 6.5x, representing a 22% discount to its historical five-year average valuation.Looking for a helping hand in the market? Members of Beyond the Wall Investing get exclusive ideas and guidance to navigate any climate. Learn More » SimonSkafar/E+ via Getty Images I Believe CF Remains A "Buy" After Its YTD Rally I covered CF Industries Holdings, Inc. (CF) only once, in January 2023, rating it as a "Buy" that I thought would reprice much higherThis article was written byDanil Sereda14.7K FollowersFollowDaniel Sereda is chief investment analyst at a family office whose investments span continents and diverse asset classes. This requires him to navigate through a plethora of information on a daily basis. His expertise is in filtering this wealth of data to extract the most critical ideas. He runs the investing group Beyond the Wall Investing in which he provides access to the same information that institutional market participants prioritize in their analysis. Learn more.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in CF over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.