Morningstar - Q2 2020 - 71

for Compass Minerals.
BEST IDEAS: EQUITY

Seth Goldstein

Compass Minerals International CMP

This article is adapted from a Morningstar equity research report dated
March 30, 2020.

Stats 03/31/2020

We are maintaining our $81
our near-term assumptions for Compass Minerals CMP in the wake
19 pandemic. Our wide moat rating is
of the economic impact of the
also unchanged.
.

Morningstar Rating
QQQQQ

Sector
r Basic Materials

Industry
Other Industrials Metals
& Mining

Price
$38.47

Fair Value Estimate
$81.00

Uncertainty
High

Economic Moat
Wide

Stewardship Rating
Standard

Market Cap
$1.2 Billion

Price/Fair Value 03/31/2020

a lower cost than competitors. Additionally, the company controls one of
only three naturally occurring brine sources that produces sulfate of potash, or
SOP, a specialty fertilizer priced at a premium to standard potash. These
operations at the Great Salt Lake in Utah can produce SOP
lower cost than producers that use a chemical process.

$90
81.00

Fair Value Estimate Per Share

60
38.47

Month-End Closing Price

with shares trading in

30

.

04/2017

04/2018

04/2019

.
.
Goderich salt mine continues to increase production, reducing unit production
.
debt obligations in the near term.

In Compass' North American fertilizer businesses, we continue to forecast a
U.S. after
2019. Further, the South American
should continue to see solid demand as a result. Although management has

70
insulated from economic disruptions. This is because roughly 80

.
example, during the Great Recession, Compass Minerals saw higher
2008, as that year had a higher number of snow days
2009, Compass Minerals
.
2008
was able to raise deicing salt prices. While we expect deicing salt
2020
.
long-term assumptions.

to include the business in our model until a potential transaction is announced.
/
EBITDA 4.1 times at the end of 2019.
total debt, only $ 2.1

$1.4 billion in

.

business without being a forced seller. This should allow the company
.K
Seth Goldstein, CFA

.

.

/ /

71


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Morningstar - Q2 2020

Table of Contents for the Digital Edition of Morningstar - Q2 2020

Contents
Morningstar - Q2 2020 - CT1
Morningstar - Q2 2020 - CT2
Morningstar - Q2 2020 - Cover1
Morningstar - Q2 2020 - Cover2
Morningstar - Q2 2020 - 1
Morningstar - Q2 2020 - 2
Morningstar - Q2 2020 - Contents
Morningstar - Q2 2020 - 4
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Morningstar - Q2 2020 - Cover3
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