Elementis (E3E) AI Stock Analysis

Elementis

(Frankfurt:E3E)

Rating:―N/A

Action:N/A

Date:―

No summary available

Positive Factors

Material deleveraging strengthens financial resilienceThe sharp reduction in debt lowers interest and refinancing risk while preserving flexibility to fund operations, product development, and customer support. A sizable equity base provides additional resilience if end-market demand remains uneven.

Negative Factors

Revenue contraction signals weak demand or volume pressureSustained revenue contraction can reduce operating leverage and limit the company’s ability to absorb fixed costs, particularly if customers continue reducing formulations demand. Recovery depends on volumes, mix, and pricing execution across key markets.

Elementis (E3E) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 1.06B
Dividend Yield: 1.74%
Average Volume (3M): 4,763
Price to Earnings (P/E): 19.4
Beta (1Y): 0.75
Revenue Growth: -14.64%
EPS Growth: ―
Country: Germany
Employees: 989
Sector: Basic Materials
Sector Strength: 61
Industry: Chemicals - Specialty

Elementis Business Overview & Revenue Model

Company Description

Elementis plc operates as a specialty chemical company in the United Kingdom, rest of Europe, North America, and internationally. It operates in two segments, Coatings and Personal Care. The Coatings segment offers production of rheological modifiers...

Elementis Earnings Call Summary

Earnings Call Date:Mar 04, 2026(Q4-2025)|% Change Since:25.77%|Next Earnings Date:Mar 10, 2027

Earnings Call SentimentPositive

The call shows a constructive transformation story: management delivered profit growth, margin expansion (+150 bps), strong Personal Care outperformance (revenue +2.4%, profit +16.9%, margin +410 bps), record innovation (16.4%) and continued cost-savings and sustainability progress. Offsetting these positives are modest revenue decline (-1.0% reported / -1.9% CC), Coatings weakness (revenue down ≈3.5% and margin compression), lower free cash flow ($41M vs $51M) and higher leverage (1.3x). Strategic portfolio moves (Alchemy acquisition, Talc sold, pharma disposal) sharpen focus and are accretive over time but change scale. On balance the highlights — margin expansion, EPS growth (+14.2%), successful cost programs, innovation momentum and clear strategic direction — slightly outweigh the near-term operational and macro headwinds.

Positive Updates

Adjusted Operating Profit Growth and Margin Expansion

Adjusted operating profit increased 4.6% to $126.7M and group adjusted operating margin improved 150 basis points to 21.2%, demonstrating margin resilience despite a softer demand environment.

Negative Updates

Group Revenue Decline

Group revenue fell to $597.5M, down 1.0% reported and down 1.9% on a constant currency basis versus prior year, reflecting softer demand in coatings and mix changes.

Company Guidance

The management reiterated medium‑term guidance under the Elevate Elementis plan of mid‑single‑digit revenue growth, operating margins above 23%, 3‑year operating cash conversion >90% and ROCE (ex‑goodwill) >30%, alongside a target to lift innovation sales from 16.4% in 2025 toward 20%; near‑term technicals include 2026 CapEx of 4–5% of revenue, R&D rising from 2% to 3% of revenue (a 50% increase), a goal to reach ~1x net debt/EBITDA organically by end‑2026 (net debt/EBITDA was 1.3x at year‑end with net debt $185.4m), and a ~30% dividend payout policy (2025 full‑year dividend $0.043, final $0.03); 2025 results to keep in mind as context were revenue $597.5m (‑1% reported, ‑1.9% CC), adjusted operating profit $126.7m (+4.6%), adjusted margin 21.2% (+150bps), adjusted EPS $0.137 (+14.2%), free cash flow $41m, and the company expects to distribute net proceeds from the announced pharma disposal (pharma revenue $35m in the prior year); cost‑savings deliverables include $18m of self‑help savings in 2025, completion of elements of a $30m program ( ~$12m via Fit for the Future) plus an additional $10m target (of which $6m is already delivered, $4m to come by end‑2026), while operational targets include a 20% improvement at St. Louis (two‑thirds of a 30% unlock) and achieving half of a 20% On‑Time‑In‑Full uplift.

Elementis Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

DE:E3E against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GB:CRDA	66Neutral	GBP 5.09B	64.43	3.65%	3.05%	3.36%	-43.08%
Sector *	61Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
GB:VCT	59Neutral	GBP 786.60M	-39.26	-4.95%	2.97%	-1.24%	-166.15%
GB:SYNT	57Neutral	GBP 181.98M	-1.52	-13.27%	―	-4.98%	-43.98%
GB:JMAT	51Neutral	GBP 2.97B	-41.89	-4.66%	4.49%	7.70%	-128.58%

* Basic Materials Sector Average

Performance Comparison

DE:E3E and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:E3E	Elementis plc	2.24	0.43	23.69%
GB:CRDA	Croda International	3644.00	919.53	33.75%
GB:JMAT	Johnson Matthey (Uk)	2388.00	270.54	12.78%
GB:SYNT	Synthomer plc	111.00	58.70	112.24%
GB:VCT	Victrex plc	903.00	319.23	54.68%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Elementis AI Stock Analysis