Is CF Industries’ (CF) Earnings Boom Built To Last Without Iran?

CF Industries reported a strong first half of 2026, attributing its growth to factors beyond the Iran conflict. Adjusted EBITDA reached $2.2 billion, ammonia plants operated at 98% capacity, and the company raised its earnings estimate for the year. Management emphasized that the increasing cost of building global nitrogen capacity will lift the price required to justify new plants, leading to higher earnings even in regular years.

This argument hinges on projects in Blue Point and Yazoo City, both of which are on track for completion. The quarter's results support management's narrative, with net earnings of $727 million and free cash flow of around $1.8 billion. The company has repurchased 10.6 million shares, raised its dividend by 20%, and seen a 40% increase in investor ownership since 2020.

Despite the geopolitical narrative, demand data suggests investors are pricing the stock as a geopolitical trade. Capital spending is set to increase as Blue Point construction progresses, and hedge fund ownership has risen significantly. CF Industries trades at a low 7.42 times forward earnings, presenting an opportunity if its growth story materializes.