CF Industries Holdings, Inc. (CF) Intrinsic Value & DCF Valuation
Agricultural Inputs · NYSE
Current Price
$127.35
Intrinsic Value
$88.52
-43.9% margin of safety
What Is CF Industries Holdings, Inc.'s Intrinsic Value?
As of 2026-07-29, the base-case DCF model estimates the intrinsic value of CF Industries Holdings, Inc. (CF) at $88.52 per share, compared with a market price of $127.35, a margin of safety of -43.9%. The base case assumes -6.7% annual free cash flow growth and a 10.0% discount rate.
Across the sensitivity grid the estimate spans $68.53 to $112.1. Intrinsic value is an estimate built on assumptions, not a fact. A higher discount rate or slower growth pushes the estimate down, while stronger cash flow growth lifts it.
How the DCF works · Recalculate with your own assumptions · What is intrinsic value?
Is CF Industries Holdings, Inc. (CF) Undervalued?
At the current price of $127.35, CF trades above the base-case intrinsic value estimate by a meaningful margin. By this model the stock looks expensive, though faster growth than assumed would change the picture.
COMPETITIVE MOAT
↑Scale and Production Efficiency
CF Industries operates massive, highly efficient nitrogen fertilizer production facilities. This scale provides significant cost advantages over smaller competitors, making it difficult to match their output and pricing.
↑Logistics and Distribution Network
The company possesses an extensive and integrated logistics network, including terminals and transportation assets. This ensures reliable and cost-effective delivery of products to a broad customer base.
↑Capital Intensity and High Barriers
Building new nitrogen fertilizer plants requires immense capital investment and specialized expertise. This high barrier to entry deters new competitors from entering the market and challenging established players.
INVESTMENT RISKS
↓Environmental Regulations and Carbon Emissions
Increasingly stringent environmental regulations, particularly concerning carbon emissions, could necessitate significant capital expenditures for CF to upgrade facilities or adopt new technologies.
↓Geopolitical Instability and Trade Policies
Global geopolitical events and shifting trade policies can disrupt supply chains, impact raw material availability, and affect international fertilizer demand and pricing.
↓Technological Advancements in Agriculture
Emerging agricultural technologies, such as precision farming and alternative nutrient sources, could potentially reduce the reliance on traditional nitrogen fertilizers over the long term.
Base case
CF base case valuation
Intrinsic Value
$88.52
Margin of safety
-43.9%
Expected annual return
-7.0%
Base case assumptions: -6.7% annual growth, 10.0% discount rate, 12x exit multiple, 5 year projection. Data as of 2026-07-29.
This base case uses default assumptions and is not financial advice. The intrinsic value changes significantly when the growth rate or discount rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the CF valuation
Adjust the growth rate, discount rate, and exit multiple to see how the intrinsic value and margin of safety for CF Industries Holdings, Inc. respond.
Open DCF Calculator for CFCompany Overview
CF Industries Holdings, Inc. is a global producer and distributor of hydrogen and nitrogen-based products. These essential chemicals serve a variety of purposes worldwide, including energy generation, agricultural fertilization, environmental emissions reduction, and numerous other industrial applications. The company's core product lineup features vital nitrogen compounds such as anhydrous ammonia, granular urea, urea ammonium nitrate (UAN), and different forms of ammonium nitrate. In addition to these primary offerings, CF Industries also provides specialized chemicals like diesel exhaust fluid, urea liquor, nitric acid, and aqua ammonia, alongside complex fertilizers containing nitrogen, phosphorus, and potassium. Its diverse customer base includes agricultural cooperatives, independent fertilizer distributors, commodity traders, wholesalers, and a wide array of industrial end-users. Founded in 1946, the firm is headquartered in Deerfield, Illinois.
Financial Metrics — CF Stock Valuation Data
Revenue/Share (TTM)
$48.04
FCF/Share (TTM)
$10.51
ROIC (TTM)
15.4%
ROE (TTM)
35.2%
P/FCF
12.1x
EV/EBITDA
5.7x
FCF Yield
8.29%
Debt/Equity
0.68x
On a trailing twelve-month basis, CF generates free cash flow per share of $10.51 alongside a ROIC of 15.4%, both central inputs for a DCF valuation. Its P/FCF ratio of 12.1x and FCF yield of 8.29% then frame how CF is priced against peers on a cash flow basis.
Frequently Asked Questions
What is the intrinsic value of CF?
CF Industries Holdings, Inc. currently generates $10.51 in free cash flow per share. At the current price of $127.35, a DCF model would discount these cash flows at an appropriate WACC and apply a terminal growth rate to arrive at an intrinsic value. The result depends heavily on your growth and discount rate assumptions — a 1% change in WACC typically shifts the fair value estimate by 10-15%. In MiniValuator the model uses a single discount rate that you can edit directly, 10% by default, rather than a computed WACC.
Is CF undervalued?
CF trades at a P/FCF ratio of 12.1x with a free cash flow yield of 8.29%. A low P/FCF means investors are paying less per dollar of free cash flow; whether that is cheap depends on the company's growth, cyclicality, and capital intensity. However, whether CF is truly undervalued requires comparing the DCF intrinsic value to the current market price and evaluating whether the margin of safety is sufficient for your risk tolerance.
How do I value CF stock using DCF?
To perform a DCF valuation on CF Industries Holdings, Inc.: (1) Start with the trailing free cash flow per share ($10.51) as the base, (2) project future FCF growth over 5-10 years based on Agricultural Inputs industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting CF's risk profile — with a debt-to-equity of 0.68x, capital structure is an important factor, and (4) add a terminal value for cash flows beyond the projection period.
What is DCF valuation and how does it apply to CF?
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For CF Industries Holdings, Inc., this means projecting how much free cash flow the company will produce over the next 5-10 years, shaped by Agricultural Inputs trends, then discounting those amounts to today's dollars. CF's ROIC of 15.4% reflects how efficiently the company converts invested capital into profit.
How does WACC affect CF stock valuation?
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For CF, with a debt-to-equity ratio of 0.68x, the capital structure directly influences WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%. At an EV/EBITDA of 5.7x, the market's implied discount rate can be reverse-engineered for comparison. In MiniValuator you set this discount rate yourself as a single editable number, 10% by default, instead of computing a formal WACC.
Learn More
- See CF PE Valuation → — Earnings-based stock valuation using PE ratio analysis
- DCF Methodology — Step-by-step guide to discounted cash flow analysis
- PE Methodology — Guide to PE ratio stock valuation
- WACC — Understanding the discount rate used in DCF
- Margin of Safety — How to evaluate downside protection
- Intrinsic Value — How to evaluate stock fair value
- How to Calculate Intrinsic Value — Complete guide for investors
Related Valuations
All Basic Materials valuationsDCF and P/E value CF with different methods and assumptions, so the two conclusions can differ. Compare the P/E fair value.
Price as of 2026-07-29. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.