Super Monkey Portfolio Addition: The Mosaic Company
Andrew is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
After I published the last article introducing the Super Monkey Portfolio, I received some great feedback that I felt perfectly articulated the purpose of the Super Monkey Portfolio.
“I suppose one of the merits of the Super Monkey approach is that it causes an investor to look at stocks they otherwise might not have considered. It generates random stocks, not for purchase, but for consideration. So it removes any bias the investor has that would otherwise cause the investor to gravitate towards certain sectors or industries.”
I have to thank reader beingregulated for understanding the goal of the Super Monkey Portfolio. As I continue to write and develop this portfolio, I am creating what I call “foundational pillars.” Each pillar represents a key component to what I believe will be a successful portfolio. I want to share the first pillar in this article:
- Purchasing pillar – the purchasing pillar is a guide to determine how much of each stock will be purchased. For the immediate time, I will be “purchasing” 1000 shares of each new addition to the Super Monkey Portfolio. Each new addition will be purchased at the price of publication.
My goal is to be as transparent as possible with the strategy and results of the Super Monkey Portfolio. As I progress with this portfolio and additional stocks are added I will be reporting the performance results on a monthly basis. That being said, let me introduce the most recent addition to the Super Monkey Portfolio: The Mosaic Company (NYSE: MOS)
About the Company
The Mosaic Company is a producer and marketer of concentrated phosphate and potash-based crop nutrition for the agriculture industry. Formed in 2004, The Mosaic Company sells their products through a variety of vendors including wholesale distributors, retail chains, co-ops, and national accounts.
Reasons for Consideration
The Mosaic Company operates in a selective marketplace. There is minimal direct competition, with their major competitor being Potash Corp of Saskatchewan (NYSE: POT). The lack of competition is not the sole factor in determining to include this stock in the Super Monkey Portfolio. Below are some of the key statistics that intrigued me about The Mosaic Company.
Quick Ratio = 3.0x
Price to Book = 1.82x
Net Profit Margin = 25.37%
Debt to Equity = 0.07x
This is just a sample of the factors that were taken into consideration to select this stock. One thing that was somewhat alarming to me is that The Mosaic Company’s stock price has plummeted 27.86% in the last year. However, combined with the price to book, this appears to be an artificially depressed stock.
The Mosaic Company is a solid stock with solid financials. I fully anticipate this stock price to increase over the upcoming months. I look for good things from this stock in 2012.
Andrew Dillard does not own any shares of The Mosaic Company
