MOS EPS at $1,000 DAP. I used the latest quarter as a starting point, they earned $1.08 on an adjusted basis. The average DAP price was $487. So at $1,000, I simply multiplied revenues by 1,000/487, kept costs fairly fixed (up a little) to get operating earnings for a third quarter at higher prices. The third quarter is generally a weaker quarter (sales and profit wise) and account for about 22 % of annual sales, so I simply used that number as an annual operating earnings estimator i.e. third quarter projected earnings/0.22. And low and behold I got an annual estimated earnings of $20.51. Of course lots of problems with that analysis but there's some safety cushion as I have not accounted for any of their production expansion plans. I feel MOS should easily sell for 15 times earnings, which puts the price at over $300, more than a double from here. As one of the premier US fertilizer companies with huge earnings growth, it could demand a 20 multiple especially if the food shortages persist but more likely it will probably be taken out at an even higher multiple. I can always dream - of course I won't make those really big bucks as my call options will come back to haunt me.
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