Leading Independent Investment Research, Morningstar, Inc.

Morningstar

Leading Independent Investment Research

Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. We offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors. 

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Equity Bottom-Up

Potash Corp Of Saskatchewan / Equity Bottom-Up

<ul><li class="p1">We have lowered our long-term potash price outlook roughly&nbsp;10% to $285 (real terms) per metric ton from $315.</li><li class="p1">We now&nbsp;expect negotiations with China in 2016 will end in a cut to&nbsp;the contract price.</li><li class="p1">We expect potash supply growth to&nbsp;slightly exceed demand up to 2020.</li><li class="p1">As a result, we expect&nbsp;prices to slide in real terms until that time.</li><li class="p1">At $22 per share, we think PotashCorp's shares are&nbsp;undervalued.</li><li class="p1">It seems the market is pricing in flat volumes&nbsp;and weaker prices than we're expecting</li></ul>

We have lowered our long-term potash price outlook roughly&nbsp;10% to $285 (real terms) per metric ton from $315.We now&nbsp;expect negotiations with China in 2016 will end in a cut to&nbsp;the contract price.We expect potash supply growth to&nbsp;slightly exceed demand up to 2020.As a result, we expect&nbsp;prices to slide in real terms until that time.At $22 per share, we think PotashCorp's shares are&nbsp;undervalued.It seems the market is pricing in flat volumes&nbsp;and weaker prices than we're expecting

We've Cut Our Potash Producer Fair Value Estimate on Price Pressure, But Shares Look Compelling