Mosaic: Slow Growth, Deep Value

Ezequiel Szyrko120 FollowersFollow5ShareSavePlay(12min)CommentsSummaryMosaic's relative valuation suggests it's significantly undervalued. For instance, its EV/Revenue multiple suggests a 37% upside.I expect MOS to have a 29% upside, based on these assumptions: revenues growing at 4% CAGR and a net margin of 9% (which is 130 basis points below the current level).Across the entire P&L, everything hinges on phosphate and potash prices. Tonnage has been flat for the last three years, though we've seen some improvement over the last two quarters.Key risks are fertilizer prices, the agricultural cycle, and sluggish growth. The latter could lead to poor stock price performance, which is my main concern for this company. fotokostic/iStock via Getty Images Thesis I rate Mosaic Inc. (NYSE:MOS) as a Buy, though with a word of caution regarding its sluggish growth. I expect 29% upside over the next 12 months, based on revenues growing at 4%, net profit margin at 9% andThis article was written byEzequiel Szyrko120 FollowersFollowMy investing approaches are GARP, Value, and Growth. I closely follow insider buying and buybacks. Also, I pay attention to some technical analysis tools, such as Elliott Wave, EMA crossovers, and chart patterns.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 MOS 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.