Potash rides wave of demand as food prices surge
By Euan Rocha
TORONTO (Reuters) - Potash Corp, the Anglo-American mining giant whose hostile takeover bid was blocked by the Canadian government in November.
The stock-price gain, which Doyle had predicted during the takeover battle, reflects the bullish outlook for agricultural inputs in general and fertilizers in particular.
Shares of the company, which rose 6 percent early on Thursday, pared gains later in the session. The stock closed up 3.3 percent at $174.14 in New York and up 2.9 percent at C$172.26 in Toronto.
Some analysts and investors have cautioned that the stock might be slightly overvalued at this time.
"It's hard to justify the current price," said Schwartz. "The only way to justify the current price is if you believe in the long-term fundamentals of potash."
The 3-for-1 split announced late Wednesday effectively cuts the price of an individual Potash Corp share after a 70 percent increase over the past year. The move will help improve trading liquidity and encourage more retail investors to invest in the company, analysts say.
Potash Corp's fourth-quarter net income rose to $482.3 million, or $1.61 a share, from $239.2 million, or 79 cents, a year earlier. The company said costs related to the takeover battle with BHP reduced profit by 16 cents a share. Continued...