2024-04-17 11:36:24 ET
Summary
- Compass Minerals has been a horrible investment in the last few years and the company once again had to report a quarterly loss.
- The company still has a moat in its salt business, but failing projects and a horrible stock and business performance overshadow the economic moat.
- The stock could be undervalued at this point and maybe supported from a technical point of view, but I still won't invest in the business.
Can I confess something? I am really glad that I somehow saw the writing on the wall and sold my shares of Compass Minerals International ( CMP ) with a decent profit about two years ago. In April 2022, I also published an article explaining my reasoning for selling Compass Minerals and in the conclusion, I wrote:
I am not saying that you should sell Compass Minerals International at this point. The company still has a wide economic moat around its business, which will ensure solid free cash flows in the years to come. But I don’t see a clear path for the stock to move much higher than it is trading now, and I don’t know if the stock will move higher than $75 right now (highs of the last few years). Before, the 7% dividend yield was actually a reason to hold the stock as the performance of the stock itself was not so great. But without the dividend and me not seeing a clear path for the stock moving higher, I made the decision to sell my position and use the cash otherwise.
Read the full article on Seeking Alpha
For further details see:
Compass Minerals: How Did We End Up Here?